EUR/USD: Drop below 1.02 to trigger another leg lower

EUR/USD has plunged to its weakest level in nearly two decades. As FXStreet’s Eren Sengezer notes, additional losses could be witnessed if 1.02 support fails.

Sellers to retain control with a drop below 1.02

“The US Federal Reserve will release the minutes of its June monetary policy meeting. The CME Group FedWatch Tool shows that markets are pricing in an 88% probability of a 75 basis points Fed rate hike in July. If the Fed's publication lowers that chance, EUR/USD could stage a rebound on renewed dollar weakness.”

“On the upside, 1.0260 (static level, former support) aligns as initial resistance ahead of 1.0300 (psychological level). Only a daily close above the latter could discourage sellers and open the door for an extended rebound toward 1.0370 (20-period SMA).”

“1.0200 (psychological level) forms the next line of defense. In case this level fails, 1.0130 (static level from November 2002, former resistance) could be seen as the next bearish target.”