Forex: EUR/USD Technical Analysis – Short Entry Setup Sought
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- EUR/USD Technical Strategy: Pending Short
- Support: 1.3663 (channel floor)
- Resistance: 1.3814-30 (channel top, 23.6% Fib exp.), 1.3928 (38.2% Fib exp.)
The Euro found support at the bottom of a falling channel set from mid-March after declining as expected against the US Dollar. A bounce from here targets the 1.3814-30 area, marked by the channel top and the 23.6% Fibonacci expansion, with a break higher exposing the 38.2% level at 1.3928. Near-term support lines up at the channel bottom, now at 1.3663.
Our long-term fundamental outlook calls for a weaker Euro against the greenback, but entering short at current levels looks unattractive from a risk/reward perspective. We will remain on the sidelines for now, aiming for a continued correction higher to provide a better selling opportunity in the days ahead.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com