EUR/USD Drops To Key Support, Upsides Capped
|Key Highlights
- EUR/USD declined below 1.2200 and it tested the 1.2065 support zone.
- GBP/USD is eyeing an upside break above 1.3700 and 1.3750.
Looking at the 4-hours chart, the pair broke a couple of important supports near 1.2220 and 1.2200. There was also a break below a major bullish trend line with support near 1.2245 on the same chart.
As a result, there was a sharp decline below the 1.2180 level and the 100 simple moving average (red, 4-hours). The pair traded close to the 1.2065 support level and it even broke the 200 simple moving average (green, 4-hours).
A low is formed near 1.2064 and the pair is currently consolidating losses. The first major resistance on the upside is near 1.2100. The main resistance for a fresh increase is likely forming near 1.2180 and the 200 SMA.
Conversely, the pair might fail to start a fresh increase above 1.2100 and 1.2120. In the stated case, there is a risk of a downside break below the 1.2065 support zone. The next major support is near the 1.2010 and 1.2000 levels.
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