EUR/USD Technical Analysis: A Top in Place Below 1.08?
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- EUR/USD Technical Strategy: Flat
- Euro chart positioning hints a turn lower against the US Dollar may be brewing
- Risk/reward considerations, fundamental uncertainty argue against short trade
The Euro put in a bearish Dark Cloud Cover candlestick pattern, hinting that the beginnings of a turn lower against the US Dollar may be starting to take shape. Negative RSI divergence hints at ebbing upside momentum and bolsters the case for a downside scenario.
From here, a daily close below rising trend line support at 1.0684 opens the door for a test of the 14.6% Fibonacci expansion at 1.0589. Alternatively, a push upward that breaches the 38.2% Fib retracement at 1.0828 paves the way for a challenge of the 50% threshold at 1.0978.
Risk/reward considerations argue against taking a short position at current levels as prices sit squarely atop near-term support. Furthermore, the threat of renewed “Trump trade” unwinding makes for a vulnerable greenback. On balance, opting for the sidelines seems prudent for now.
Will the Euro continue to rise through the first quarter of 2017? See our forecast and find out!
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