EURUSD started the week in a neutral tone, consolidating last week’s losses around the 50-day simple moving average (SMA), which happens to be near a key restrictive line and the 38.2% Fibonacci retracement of the 1.1600 – 1.2348 upleg, at 1.2063.
EURUSD started the week in a neutral tone, consolidating last week’s losses around the 50-day simple moving average (SMA), which happens to be near a key restrictive line and the 38.2% Fibonacci retracement of the 1.1600 – 1.2348 upleg, at 1.2063.
While this could be an ideal place for a rebound, the momentum indicators continue to provide conflicting signals in favor of the bears. The MACD, comfortably below its red signal line, is converging towards the zero line, while the RSI keeps trending towards its 30 oversold level. Another discouraging sign is the progressing bearish cross between the red Tenkan-sen and blue Kijun-sen lines.
Should selling pressure persist, the 50% Fibonacci of 1.1974 may attempt to add some footing ahead of the 61.8% Fibonacci of 1.1886. Crossing the latter, the price may find immediate support around the 1.1835 barrier, a break of which could prompt another negative correction to 1.1750.
In the case that the 1.2063 area proves a hard nut to crack, the pair may drift towards the 23.6% Fibonacci of 1.2172, while slightly higher, the 20-day SMA could also constrain bullish actions around 1.2200 as it did last week. If the rally gets excessive, the door will open for January’s high of 1.2348, while not far above it the resistance line could be a more challenging obstacle.
Summarizing, EURUSD is maintaining a bearish profile in the short-term picture, and it would be interesting to see if the 1.2063 key level can stabilize the sell-off.
Forex trading and trading in other leveraged products involves a significant level of risk and is not suitable for all investors.
Recommended Content
Editors’ Picks
EUR/USD retreats to 1.0750, eyes on Fedspeak
EUR/USD stays under modest bearish pressure and trades slightly near 1.0750 on Wednesday. Hawkish comments from Fed officials help the US Dollar stay resilient and don't allow the pair to stage a rebound.
GBP/USD struggles to hold above 1.2500 ahead of Thursday's BoE event
GBP/USD stays on the back foot and trades in negative territory below 1.2500 after losing nearly 0.5% on Tuesday. The renewed US Dollar strength on hawkish Fed comments weighs on the pair as market focus shifts to the BoE's policy announcements on Thursday.
Gold fluctuates in narrow range below $2,320
After retreating to the $2,310 area early Wednesday, Gold regained its traction and rose toward $2,320. Hawkish tone of Fed policymakers help the US Treasury bond yields edge higher and make it difficult for XAU/USD to gather bullish momentum.
SEC vs. Ripple lawsuit sees redacted filing go public, XRP dips to $0.51
Ripple (XRP) dipped to $0.51 low on Wednesday, erasing its gains from earlier this week. The Securities and Exchange Commission (SEC) filing is now public, in its redacted version.
Softer growth, cooler inflation and rate cuts remain on the horizon
Economic growth in the US appears to be in solid shape. Although real GDP growth came in well below consensus expectations, the headline miss was mostly the result of larger-than-anticipated drags from trade and inventories.