The EUR/USD has plunged aggressively today and has reached fresh new lows, the rate has finally broken below the short term sideways movement and now is targeting new lows. Price has resumed the yesterday’s bearish candle, has become strongly bearish on the short term because has taken out an important support area, the Euro is trading in the red even if the Euro-zone data have come in better today. The USD edges higher as the US dollar index have jumped much above the yesterday’s high from 97.24 level, the index is approaching the 97.58 major resistance, where he could find temporary resistance again. The perspective remains bullish on the USDX, could jump even above the mentioned resistance level, this situation will help the USD to climb much higher versus all its rivals.
The EUR wasn’t inspired by the Euro-zone economic data, the ZEW Economic Sentiment rose from 5.4 to 12.3 points, more than 6.3 estimate, while the German ZEW Economic Sentiment has increased from 0.5 to 6.2 points, more than the 4.2 forecast. The USD has resumed the upside momentum versus the other major currencies, the NFIB Small Business Index has decreased from 94.4 to 94.1 points, even if the economists have forecasted an increase to 95.2 points. The US is to release also the Labor Market Conditions Index , but I don’t believe that will have a significant impact on the EUR/USD.
Technically the rate is expected to drop further, however, we could still have a minor rebound on the short term before we’ll see new lows, could come to retest the broken support levels and the 1.1100 level, the rate has squeezed a little in the last hours as the USDX has slipped lower after the morning rally.


The rate has finally broken below the 1.1123 support level, has slipped again inside the short descending pitchfork’s body and now could be attracted by the confluence area formed at the intersection of the median line (ml) of the descending pitchfork with the 1.0908 static support, the rate is expected to drop in the coming days as the USDX could take out the 97.58 horizontal resistance. The rate could come a little higher to test and retest the upper median line (uml) before will slip lower, but as I’ve said, the perspective is bearish on the short term. Technically the rate is expected to reach also the 1.0823 level.


You can see on the H4 chart that the rate has found strong resistance at the descending sliding line and now has plunged through the 1.1123 static support, the next downside target is at the median line of the descending pitchfork, where we could find temporary support, the price could drop much deeper because has escaped from the ascending channel body, the USDX has reached new highs and could climb much higher in the coming weeks.

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