The Euro collapsed through key support zone on Tuesday and hit the lowest in almost two decades, in the biggest daily fall since Jun 16, 2021.
Fresh weakness was sparked by renewed risk aversion on rising gas prices that fueled fears of recession, with data released today, showed that Eurozone business growth slowed significantly in June, adding to negative signals.
Strong demand for US dollar also contributed to Euro’s weakness.
Technical picture on all larger timeframes is firmly bearish and supports the price action, with close below key supports at 1.0358/49/40 (Jun 15/May 13/2017 lows) to generate strong bearish signal of continuation of larger downtrend from 1.6039 (2008 peak).
Bears eye next targets and pivotal supports at 1.0069/1.00 (Fibo 76.4% of 0.8225/1.6039/psychological, violation of which would risk sub-parity level extension and unmask Sep 2002 low (0.9607).
Price adjustments on profit-taking are expected to be limited and to provide better selling opportunities, with former key supports (1.0340/58 zone) reverting to strong resistances which should ideally cap, but extended upticks should not exceed falling daily Tenkan-sen (1.0435) to keep bears intact.
Res: 1.0298; 1.0340; 1.0358; 1.0435.
Sup: 1.0200; 1.0182; 1.0100; 1.0069.
