Technical Bias: Bearish
Key Takeaways
Euro fell sharply against the US dollar this past week and looks set for further losses moving ahead.
Euro zone manufacturing PMI will be released today, which might cause swing moves in the EURUSD pair.
EURUSD has a support around the 1.1150 area where the Euro buyers might take a stand.
Euro downside accelerated this past and the hope for a major correction was varnished, which means it might move further lower.
Technical Analysis
The EURUSD pair managed to correct higher recently, but the Euro sellers protected the upside in the pair and took it lower again. There is a bearish trend line on the daily timeframe, which was one the reasons why the EURUSD pair failed to move higher. The pair also failed around the 38.2% fib retracement level of the last leg from the 1.1988 high to 1.1101 low. The daily RSI is heading towards the extreme levels, which means there is a possibility of a short-term correction. However, in that situation, the last swing high of 1.1280 level might come into play and could stall the upside in the near term. Any further upside might take the pair towards the highlighted trend line which might be considered as a barrier for the pair.
If the EURUSD pair continues to move lower, then the 1.1150 level might act as a support for the pair, and a break below the same might call for a test of the yearly low.
A test of 1.10 level is also likely if the Euro sellers gain control.
Euro Zone Manufacturing PMI
Later during the London session, the Euro zone Manufacturing Purchasing Managers Index (PMI) will be released by the Markit Economics. The forecast is slated for a minor rise from the last reading of 51 to 51.1.
Trade Idea
One might consider selling rallies towards the highlighted trend line in the EURUSD pair.
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