EUR/USD Technical Analysis: Watching for Corrective Bounce
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- EUR/USD Technical Strategy: Short at 1.3644
- Support: 1.3345, 1.3291, 1.3248
- Resistance:1.3419, 1.3472, 1.3516
The Euro declined against the US Dollar as expected after prices put in a bearish Evening Star candlestick pattern. A Hammer candlestick coupled with positive RSI divergence marked the beginning of an attempted recovery, as suspected. Near-term resistance is at 1.3419, 23.6% Fibonacci retracement, with a daily close above that exposing the intersection of the 38.2% level and a falling channel top at 1.3472. Alternatively, a drop below the 23.6% Fib expansion at 1.3345 targets the 38.2% threshold at 1.3291.
We entered short EURUSD at 1.3644 in line with our long-term fundamental outlook. We have already booked profit on half of the position, with the rest still active and a stop-loss revised to the breakeven level.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com