The EUR/USD has reached new lows today after a minor rebound, the Euro has managed to drag the rate a little higher in the first part of the day, but the bears remain strong. The rate has deleted the morning gains and looks determined to touch fresh new lows till the end of the week. Price has increased a little today because the US dollar index has retreated significantly, the index has dropped as much as 99.97 level, but has increased again in the last hours and now is fighting hard to climb above the 100.59 yesterday’s high, an increase above this level will force the USD to increase further versus the other currencies.
The currency pair continues to decrease as the Euro-zone and the United States economic figures have come in mixed, the Euro-zone Final CPI rose by 0.5% in October, exceeding the 0.4% estimate, while the Final Core CPI surged by 0.8%, matching expectations, has remained steady at 0.8% growth for the third month in October.
On the other hand, the United States CPI has increased by 0.4% in October, has come in line with expectations, but unfortunately the Core CPI has increased only by 0.1%, less than the 0.2% estimate, has remained steady at 0.1% for the second month in October. The Building Permits has come better than expected, was reported at 1.23M, higher than the 1.19M estimate, has remained steady and has helped the USD. Moreover the Unemployment Claims have fallen sharply from 254K to 235K and have reached the lowest level since 1973, the greenback was boosted by this unexpected drop, the traders have expected to see a an increase to 257K.
The USD was supported also by the Housing Starts indicator, which has increased from 1.05M to 1.32M, beating the 1.16M estimate.

EURUSDd-5

The rate drops aggressively again and is expected to touch the lower median line (lml) of the descending pitchfork, where he may find temporary support. The USD was expected to drag the rate down after the failure to retest the confluence area formed at the intersection of the median line (ml) with the 1.0823 static resistance. Was expected to drop after the breakout below the first warning line (WL1) of the major ascending pitchfork, could approach also the 1.0522 previous low, where he may find support as well. The perspective remains bearish as long as the rate is trading inside the descending pitchfork’s body, could drop also below the 1.0522 level if the USDX will continue to reach new highs, this scenario is less likely right now, we could have a minor rebound before the price will drop below the mentioned static support.

EURUSDh-5

The price dropped more than 640 pips after the last Wednesday’s rally, has dropped sharply and has managed to take out some important support levels, attracting more sellers, which are driving the rate towards fresh new lows. The rate is very heavy right now and remains to see if the lower median line (lml) will have enough energy to stop the bearish momentum.

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