EUR/USD To Extend Declines In Absence Of Bullish Reversal Patterns
- EUR/USD Technical Strategy: Shorts Preferred
- Absence of key reversal patterns casts doubt on a recovery
- Extended decline likely to be met by buying support at 1.34
EUR/USD may be primed to continue its descent with a void of key reversal candlesticks on the daily. While a break of the critical 1.3500 handle was initially met with some hesitation from traders (denoted by a couple of Doji formations), a push to 1.3400 now appears likely. A daily close above the now-resistance level at 1.3500 would be required to invalidate a bearish technical bias.
EUR/USD: Targeting 1.3400 With Bullish Signals Lacking
Daily Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here
Drilling down to the four hour chart; a sea of Doji candlesticks near 1.3455 suggested significant hesitation from the Euro bears to push the single currency lower. However, similarly to the daily chart; key reversal patterns remain absent following the break, paving the way for a drop to 1.3400.
EUR/USD: Absence of Key Reversal Patterns Casts Doubt On A Recovery
4 Hour Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here
By David de Ferranti, Market Analyst, DailyFX
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