EUR/USD’s down trend from 1.2348 finally resumed last week by breaking through 1.1185 and hit as low as 1.1120. Initial bias stays on the downside this week. Next target is 61.8% projection of 1.1908 to 1.1185 from 1.1482 at 1.1035. Break will target 100% projection at 1.0759. On the upside, above 1.1243 minor resistance will turn intraday bias neutral first. But recovery should be limited well below 1.1482 resistance to bring down trend resumption.
In the bigger picture, the strength of the the decline from 1.2348 (2021 high) suggests that it’s not a corrective move. But still, it could be the fourth leg of a sideway pattern from 1.0339 (2017 low), or resuming long term down trend. In any case, outlook will now stay bearish as long as 1.1482 resistance holds. Next target would be 1.0635 low.
In the long term picture, EUR/USD should have failed 1.2555 cluster resistance (38.2% retracement of 1.6039 to 1.0339 at 1.2516) again. The break below a flat 55 month EMA is keeping long term outlook bearish. That is, the down trend from 1.6039 (2008 high) is still in progress. Break of 1.0339 will open up further decline towards 0.8223 (2000 low).
