EUR/USD analysis: falls below 100-day SMA

EUR/USD Current Price: 1.1278

The EUR/USD pair extended losses on Thursday weighed by worsening sentiment in financial markets. The US-China trade dispute remains amid the main drivers alongside with expectations of a rate cut by the Federal Reserve in the upcoming months. Today, US President Trump said that he has no deadline for making a deal with China, yet also that more tariffs are coming. Adding pressure on the EUR/USD, the IMF deemed as precarious the euro area’s central forecasts. Tomorrow, Germany’s wholesales inflation, US retail sales alongside a couple of major indicators from China (retail sales and industrial production) will be the main events on the calendar.

EUR/USD briefly fell below 100-day SMA and hit a weekly low of 1.1268 before recovering slightly. Technical readings have turned from neutral to slightly bearish in the 4-hour chart, with the price below the 20-SMA and indicators below their midlines, yet flat. While in daily charts the picture remains slightly positive, the pair has begun to lose upward potential. A decisive break below the 100-day SMA - currently at 1.1270, could add pressure and send EUR/USD to next support area around 1.1225, which is the 50% Fibo retracement of the 1.1107/1.1347 rally. On the other hand, if the pair manages to regain the 1.1310 area, it could shrug off immediate pressure and make another attempt at the 1.1350 zone, key short-term resistance to switch the bias.

Support levels: 1.1255 1.1225 1.1190

Resistance levels: 1.1350 1.1365 1.1400

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