EURUSD Outlook: Rise in Italian bonds pushes Euro below daily cloud

Slobodan Drvenica Windsor Brokers

EURUSD

The Euro fell to one-week low at 1.1526 on Wednesday, driven by rise in Italian bonds. Fresh bearish acceleration returned below daily cloud, adding to negative outlook as Tuesday's candle with long upper shadow, which signaled strong upside rejection, weighs. Probe below 10SMA (1.1536) reinforces negative near-term structure and shifts risk towards 1.1504 pivot (Fibo 61.8% of 1.1432/1.1621 upleg). Significantly weaker than expected US housing data ( Sep building permits -0.6% vs 2.1% f/c / Sep housing starts -5.3% vs -4.5% f/c and 7.1% in Aug) did not show stronger impact on dollar, with focus turning on FOMC minutes, due later today. The single currency could accelerate further down on hawkish Fed which would boost the dollar on expectations on Fed's rate hike in Dec. Daily close below cloud is needed to confirm bearish stance and reversal after multiple upside rejection.

Res: 1.1536; 1.1583; 1.1599; 1.1624
Sup: 1.1504; 1.1476; 1.1463; 1.1432

Interested in EURUSD technicals? Check out the key levels

1. R3 1.1666
2. R2 1.1644
3. R1 1.1609
PP 1.1587
1. S1 1.1552
2. S2 1.153
3. S3 1.1495

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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