The Euro stands at the back foot and pressuring 1.20 support after bulls stalled on approach to daily cloud top (1.2092) Wednesday.
Doji candle with long upper shadow that was formed on Wednesday, signaled strong upside rejection, while today’s fresh weakness adds to negative signals on bull-trap above 1.2037 Fibo barrier and formation of reversal pattern on daily chart.
Fresh weakness is supported by fading bullish momentum and stochastic reversing from the overbought territory on daily chart, but negative signals need confirmation on break of pivotal supports at 1.2000/1.1975 (psychological/daily cloud base).
This would lead to a deeper correction of the uptrend from 1.1704 (Mar 31 low) and expose next pivots at 1.1966 (converged 10/30 DMA’s) and 1.1936 (Fibo 38.2% of 1.1704/1.2079 rally.
Conversely, shallow dips (contained by 1.2000/1.1975 supports) would signal mild correction and keep bulls firmly in play for fresh push through pivots at 1.2037/54 (Fibo 61.8% / 100DMA).
Res: 1.2042, 1.2054, 1.2079, 1.2092.
Sup: 1.2000, 1.1975, 1.1966, 1.1936.
