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EUR/USD Technical Analysis: Digesting Losses Near 1-Year Low

EUR/USD Technical Analysis: Digesting Losses Near 1-Year Low

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Talking Points:

  • EUR/USD Technical Strategy: Short at 1.0700
  • Euro selloff stalls after prices hit one-year low above 1.05 figure
  • Positive RSI divergence hints at bounce but confirmation absent

The Euro has paused to digest losses against the US Dollar having found support after sliding to a one-year low above the 1.05 figure.Positive RSI divergence hints a bounce may be ahead but confirmation of upward reversal is notably absent thus far.

A daily close above the 76.4% Fibonacci expansionat 1.0715 opens the door for a retest of the 61.8% level at 1.0826. Alternatively, a reversal below the 1.0517-34 area (December 2015 low, 100% Fib) paves the way for a challenge of the 123.6% expansion at 1.0353.

A EUR/USD short trade was triggered at 1.0700 and partial profit has been booked after prices hit the initial objective. The rest of the position will remain open, looking to capture down trend continuation. The stop-loss is now at the breakeven level.

What are the fundamental trends driving the Euro in the fourth quarter? Find out here !

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.