EUR/USD Technical Strategy: BEARISH
- Euro downtrend intact after rebound form support below 1.12
- Candle structure, negative RSI divergence hints at downturn
- Break of near-term support near 1.1280 may be confirmation
See the quarterly Euro forecast to learn what is likely to drive price action through mid-year!
The Euro rebounded from support below the 1.12 figure against the US Dollar to retest resistance guiding the single currency lower since late September 2018. Prices action has been choppy, but a shallow series of lower highs and lows suggests the prevailing near-term bias remains bearish.
Candlestick structure hints at indecision. Long upper wicks and small candle bodies point to forceful rejections on back-to-back tests of resistance hints at fraying bullish conviction. Early signs of negative RSI reinforce the sense that upside momentum is ebbing.
Zooming in to the four-hour chart, the first layer of support looks to be at 1.1285, the intersection of a chart inflection barrier and a counter-trend line. Breaking below that exposes 1.1250 next. A minor upside hurdle lines up at 1.1332 but bearish bias invalidation calls for a break of trend resistance, now at 1.1390.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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