The EUR/USD has been sliding since last week when it broke below a consolidation structure. We will look at the overall medium-term breakout, but first let’s first review the near-term breakouts since last week.
Persistent Downtrend Since Last Week:
The 1H chart shows that it all started with a break below 1.0962, which put in a near-term price top. Then, the bearish trend in the short-term has been persistent as price continued to break to the downside after consolidation, bullish correction attempts.
The 200-, 100-, and 50-hour SMAs have been turned to downwards slope with bearish alignment and price has been trading under these moving averages. The rSI has tagged 30 and held under 60, which reflects maintenance of the bearish momentum.
Today, (4/13) as we get into the US session, price again broke a small coiling consolidation around 1.06, which was the mode to end last week. Now, we are back in the bearish continuation mode.
Key Support and Resistance:
The 4H chart shows that the current downtrend is a bearish continuation breakout swing from last week. In this scenario.
Now, as price approaches 1.0462, there could be some support. However, because this is a bearish trend, we should limit the bullish outlook from this support at most to the 1.0720, or possibly the 1.08 area. We should also look at the 1.0610 level as a possible resistance. A break above 1.08 would suggest and reflect further consolidation and a break above 1.0850 would suggest bullish pressure towards the 1.1040 resistance area.
The main event risk for EUR/USD this week will be Wednesday’s ECB monetary policy statement and press conference. What can save the euro from falling further in the short and medium-term? A tone that suggests the bank might want to shorten its QE program .
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