EUR/USD Price Analysis: Rising wedge lures Euro bears as Fed, ECB decisions loom, 1.0720 eyed
- EUR/USD grinds lower within bearish chart formation ahead of US inflation, Fed and ECB announcements.
- Looming bear cross on MACD, RSI retreat from overbought territory favor sellers.
- 50-SMA adds strength to 1.0720 support; Euro buyers have a bumpy road to travel.
EUR/USD takes offers to refresh intraday low as it prints mild losses near 1.0745 while extending the previous day’s fall amid early Monday. In doing so, the major currency pair drops with a one-week-old rising wedge bearish chart formation after snapping a four-week downtrend in the last.
Also read: EUR/USD grinds near mid-1.0700s as Fed vs. ECB play gains attention
It’s worth noting that an impending bear cross on the MACD indicator and the RSI (14) line’s U-turn from the overbought territory, towards the 50.0 levels of late, add strength to the Euro pair’s downside bias.
However, a convergence of the 50-SMA and the aforementioned rising wedge’s bottom line, close to 1.0720, appears a tough nut to crack for the EUR/USD bears to crack.
Following that, the previous weekly low of around 1.0670 may act as an intermediate halt before directing the bears toward the yearly low marked in May surrounding 1.0635.
It should be observed that the rising wedge’s confirmation ultimately directs the Euro bears toward the theoretical target of around 1.0570.
Alternatively, EUR/USD recovery needs to defy the rising wedge bearish chart pattern by crossing the 1.0790 hurdle, quickly followed by the 1.0800 psychological resistance, to convince the Euro buyers.
Even so, multiple stops marked in late May around 1.0830 and 1.0845-50 can challenge the Euro pair buyers before giving them control.
EUR/USD: Four-hour chart
Trend: Further downside expected
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
