EURUSD had a deep fall on Friday and has been stuck below the 20-day simple moving average over the last couple of months. Looking at momentum indicators, the RSI is pointing slightly up below its neutral threshold of 50, while the MACD also remains innegative territory but is embraced by its red signal line.
In the wake of more negative pressures, the market could meet support at the 17-month low of 1.1215, before the price heads sharply lower towards the 1.1115 mark, identified by the lows on June 2017. In case of steeper declines, the pair could breach this trough, diving to 1.0830, reached on May 2017.
An upside recovery could jump above the 20- and 40-SMAs and challenge the 1.1500 strong psychological level, registered on November 7. Slightly above this region, the 23.6% Fibonacci retracement level of the downleg from 1.2475 to 1.1215, around 1.1530 could be next level to focus on, before touching the falling trend line.
Summarizing, the bearish picture in the long-term looks to last for a while longer as the world’s most traded currency pair – EURUSD – has been developing below the descending trend line since March of the current year.
