EUR/USD outlook: Bears tighten grip and crack pivotal supports
|Bears returned fully to game on Monday after Friday’s brief pause on Fed Powell’s remarks, pushing the Euro to the lowest in three weeks.
The pair slid over 0.5% until mid-US session and cracked pivotal support at 1.0818 (200DMA), looking for a bearish signal on firm break, which will be confirmed on extension and close below nearby Fibo support at 1.0799 (38.2% of 1.0448/1.1017).
Loss of these supports will add to signals of reversal pattern which is forming on daily chart and open way for deeper drop through 100DMA (1.0778) towards 1.0737 (50% retracement and 1.0700 (round-figure).
Negative momentum is strengthening on daily chart and supports the action, however, MA’s are in mixed setup and oversold stochastic warns that bears may take a breather soon.
Limited upticks should provide better levels to re-enter bearish market, with 20DMA (1.0846) offering initial resistance and broken Fibo 23.6% (1.0882) to cap and keep bears in play.
Res: 1.0818; 1.0846; 1.0882; 1.0912
Sup: 1.0799; 1.0778; 1.0737; 1.0700
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