EUR/USD Technical Analysis: Euro Down Trend Resuming?
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- EUR/USD Technical Strategy: Flat
- Euro breaks counter-trend support, hinting at down move resumption
- Risk/reward considerations argue against taking short trade for now
The Euro may be resuming its longer-term down move against the US Dollar after prices broke support guiding a shallow upswing from November lows. The pair turned higher as expected after testing a major long-term chart barrier near the 1.05 figure.
Near-term support is in the 1.0449-1.0520 area, marked by a support shelf in play since mid-March 2015 and the 38.2% Fibonacci expansion. A daily close below that exposes the 50% level at 1.0318. Alternatively, a reversal above the 23.6% Fib at 1.0611 targets the 14.6% expansion at 1.0711.
Prices are too close to near-term support to justify entering a short trade at current levels from a risk/reward perspective. Opting for the sidelines seems most prudent until the pair offers a more actionable opportunity to trade in line with the dominant bearish trend.
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