EURUSD has successfully weighed on the 50-day simple moving average (SMA) – coupled with the mid-Bollinger band – and growing bearish pressures have now clearly pushed below 1.1323, crushing buyers’ efforts to breach the 1.1500 barrier. The longer-term falling 100- and 200-day SMAs are endorsing the eight-month descent from the 1.2266 peak, while the 50-day SMAs’ bounce has softened, indicating that the rally from the near 20-month low of 1.1120 has been curbed.
The short-term oscillators are reflecting that negative momentum is gaining pace. The MACD, in the positive zone, is falling towards its red trigger and zero lines, while the dipping RSI has pierced into the bearish region. The stochastic oscillator is exhibiting a strong negative charge and the %K line has nudged into oversold territory, implying negative price action may intensify further.
If sellers retain the reins, the pair may encounter initial downside friction some distance lower around the 1.1200 border, before the lower Bollinger band at 1.1151 and the near 20-month trough of 1.1120 are challenged. If the lower Bollinger and key trough fail to halt declines from accelerating, the price could then target the 1.0986-1.1017 support band, moulded by the inside swing highs over the mid-April until mid-May 2020 period.
In the event buyers regain control and lift the price back above the immediate 50-day SMA and mid-Bollinger band, they may meet fortified resistance at the 1.1400 hurdle, where the descending 100-day SMA, at 1.1410, has neared. Should buying interest increase further, the price may overstep these obstacles and aim for the critical resistance barricade that exists from 1.1500 until 1.1553. Conquering this boundary too could reinforce upside momentum, encouraging buyers to reel in the 1.1608 high before tackling the 200-day SMA overhead at 1.1649.
Summarizing, EURUSD’s neutral-to-bearish bias is looking set to intensify. A dive in the pair deepening significantly below the 50-day SMA could confirm this, while a break below the 1.1120 trough would restart the broader decline. That said, for convincing bullish developments to return, the price would need to steer north of the 1.1683-1.1762 barrier.
