EUR/USD Technical Analysis: Euro Trend Bias Favors Weakness
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- EUR/USD Technical Strategy: Flat
- Euro trend bias continues to favor weakness amid consolidation
- Improved risk/reward needed for an actionable short trade setup
The Euro remains stuck in a narrow consolidation range near the 1.18 figure against the US Dollar but overall positioning continues to favor a bearish bias. Price action has been defined by a series of lower highs and lows since the single currency broke rising trend line support in mid-September.
Near-term support is in the 1.1711-21 area (October 5 close, 38.2% Fibonacci retracement), with a daily close below that opening the door for a challenge of the 50% level at 1.1606. Alternatively, a push above the 23.6% Fib expansion at 1.1899 exposes the 1.2041-70 zone (38.2% expansion, August 29 high).
Prices are too close to immediate support to justify entering short from a risk/reward perspective. Meanwhile, the broad case against taking up the long side is reinforced by the absence of an actionable bullish reversal signal. With that in mind, opting to remain flat seems to be most prudent.
See our Q4 forecast to learn what will drive trends for the Euro and the US Dollar through year-end!