The EUR/USD has seen its bearish trend grow stronger in the past week and yesterday’s burst of selling has taken the Forex pair to important lows.
As of this morning, the EUR/USD is trading around the 1.16000 vicinity and has suffered another surge lower in the past day, which follows a rather consistent bearish trend that has been exhibited during the month of September. The past week of trading has seen additional nervousness erupt in the EUR/USD as a downward trajectory has grown stronger.
Within the current price ratios the EUR/USD is traversing, long-term lows are now being confronted and traders who have been looking for reversals higher may be growing less optimistic. If a longer view is looked at by technical traders, it is evident that the EUR/USD has not had a large amount of price action below the 1.16000 sphere since July of 2020. Alarmingly the value of the EUR/USD was trading between 1.15000 and 1.1.16000 in July of 2020 as the Forex pair was recovering from coronavirus concerns, which actually created a low of 1.06200 in March of 2020.
The economic sphere is still being massively influenced by the results of coronavirus via supply chain logistics, inflation and the action of the central banks. The EUR/USD is also suffering from what appears to be a renewed downward slope which, when looked at with a long-term window has been taking place since May of this year. While the EUR/USD has certainly recovered from the height of its coronavirus concerns last year, circumstances are oddly similar via sentiment in the short term.
Fundamentally, the US Federal Reserve presented itself as potentially more hawkish, and the result of the recent German election appears to have months ahead to likely find a working coalition, and this combination is not helping underlying sentiment with for the EUR/USD. Technically, if the 1.16000 proves vulnerable and the 1.15850 mark begins to seriously be challenged, speculators may be tempted to wager on additional downside price action.
While it might be tempting to look for short-term reversals higher, the EUR/USD is trending in a bearish direction and traders may want to wager on this momentum. Selling the EUR/USD near current short-term resistance around the 1.16050 to 1.16200 junctures may prove a worthwhile wager in the near term. Speculators are encouraged to use solid take profit orders to cash out winnings if they emerge and stop loss positions as protection.
EUR/USD Short-Term Outlook
Current Resistance: 1.16200
Current Support: 1.15940
High Target: 1.17400
Low Target: 1.16480