EUR/USD Technical Outlook
- EUR/USD nearing a new cycle low in trend since May
- Levels and lines to watch in the days ahead
EUR/USD Technical Analysis: Euro Downtrend Looking to Extend
The Euro has clearly been in a downtrend since May, with it primarily carving out short-term lower-lows and lower-highs. Another lower-low could be in the works here very shortly. A break below 11524 will do the trick for getting EUR/USD to a new cycle low.
It will be interesting, though, to see how a new low is treated as we will quickly see the March 2020 spike-high tested, a significant point in time. That level arrives at 11495, a mere 29 pips below the October low.
We may see an initial reaction even if the Euro is to continue on lower. If we don’t see a meaningful bounce develop at that juncture, the next level to watch is 11423 and then the under-side trend-line extending low since June.
The lower-side trend-line is of interest because of the number of inflection points and how clean it is. It runs neatly under lows from June to early October. That line currently runs down near 11400, but is a moving target that is moving sharply lower given the angle of the trend-line.
To negate the currently bearish outlook, EUR/USD needs to turn around and break the clear bearish sequence of lower-lows and lower-highs. This won’t be an easy or quick feat. We would need to see the Euro trade back above 11700 to seriously consider potential for a trend reversal.
EUR/USD Daily chart
EUR/USD Chart by TradingView
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—Written by Paul Robinson, Market Analyst
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