EURUSD Technical Analysis: Breakdown Eyes Support Below 1.10
EURUSD TECHNICAL ANALYSIS: BEARISH
- Euro resolves conflicted chart setup with decisive support break
- Clearing resistance near 1.12 needed to neutralize bearish bias
- Monthly chart setting the stage to test supports below 1.10, 1.05
The Euro appears to have decisively resolved conflicted technical positioning in sellers’ favor, as expected. The single currency punched through support cutting off downside progress since late April in the 1.1107-16 area, sinking to the lowest level in over two years against the US Dollar.
Near-term support is now marked by the 50% Fibonacci expansion at 1.1040. A daily close below that exposes the 61.8% level at 1.0952 next. Resistance begins at 1.1128 – the 38.2% Fib – but clearing a trend line defining the drop from June’s swing top seems necessary to neutralize immediate selling pressure in earnest.
Zooming out to the monthly chart for a bit of perspective, it is revealed that July marked the largest drop since May 2018. More ominously still, prices have been making steady progress downward after breaking support near 1.15 in October. The puts an inflection level at 1.0980 in focus, followed by a key floor below 1.05.
Monthly EURUSD chart created in TradingView
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.