EURUSD sellers have led the pair on a sharp decline towards 1.1249, a low last seen back in July 2020, where the price began a near two-month rally, which reached a 28-month high of 1.2010. The falling simple moving averages (SMAs) are nurturing the bearish structure in the pair.
The negatively charged Ichimoku lines are indicating that downward forces have yet to subside, while the short-term oscillators are implying that negative momentum is gaining power again. The MACD is steering deeper beneath its red trigger line in the negative zone, while the RSI has dived into oversold territory. The positive charge in the stochastic %K line looks frail and suggests upside price action is questionable.
If the current trajectory prevails, immediate support may continue to emanate from the 1.1254 low. Should this key level give way, the bears could then target the support section of 1.1146-1.1200, linked to an area of lows from late March until the end of June 2020. If this boundary also fails to mute negative pressures, the price may sink towards the 1.0986-1.1017 border, associated with the inside swing highs over the April-May 2020 period.
However, if buyers produce positive traction off the 1.1254 barrier, initial resistance could arise at the 1.1374 high. Pushing beyond this, the Ichimoku lines may delay buyers from testing a resistance region formed between the 1.1500 handle and the 1.1545 mark. Should upside momentum endure, the 50-day SMA at 1.1574 could come into focus before the 1.1608 high draws traders’ attention.
Summarizing, EURUSD is exhibiting a bearish bias in the short- and medium-term picture. A dive below the 1.1254 low could further feed negative tendencies, while a drop under the 1.1146 barrier could bolster bearish concerns. For buyers to regain confidence, the pair would need to lift back above the 1.1692 obstacle.
