During the May 27 session, EUR/USD found support at 1.0818 and pulled back. As we begin the May 28 US session, it has tagged 1.0950 and is ready for bearish continuation.
The 4H chart shows that after the 5/27 session consolidation, the RSI is no longer showing oversold condition and price is closing in on a falling trendline. At this point, a break below 1.09 should signal bearish continuation with 1.08-1.0818 as a near-term target.
In the short to medium-term, there is downside risk at least back to the 1.0462-1.0520 lows on the year.
Now, let’s say price does instead holds above 1.09 and climbs above 1.0950, that would open up the 1.10 handle up to the 1.1062 support pivot. Note that in the 1.10-1.1062 area, we also have the 50 and 200-period SMA as additional resistance factors. This should be like the last line of defense for the bearish outlook. Above 1.1062, the EUR/USD’s bearish outlook should be neutralized. Then, above 1.12, the technical picture would become bullish.
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