EUR/USD stalls within strong bearish trend
James Chen August 14, 2014 8:00 PM
<p>EUR/USD (daily chart shown below) has tentatively stalled within a new bearish trend that has steadfastly asserted itself within the past three months. The current […]</p>
EUR/USD (daily chart shown below) has tentatively stalled within a new bearish trend that has steadfastly asserted itself within the past three months.
The current consolidation occurs near the year-to-date low of 1.3332, hit just last week, which established a new nine-month low for the currency pair.
Since the beginning of July, the currency pair has made a virtually uninterrupted free fall from 1.3700-area resistance, extending the broader decline from May’s 1.3993 multi-year high.
The breakdown below 1.3500 in late July provided a pivotal indicator of EUR/USD’s continued bearish momentum.
The pair has continued its decline by dropping below the 50% Fibonacci retracement level of the previous bullish trend from the July 2013 low around 1.2750 up to the noted May 1.3993 multi-year high.
Despite the current consolidation, EUR/USD continues to maintain a strong bearish bias. The 50-day moving average crossed sharply below the 200-day average in late June and has continued to slope sharply downward.
With major upside resistance on any rebound still residing at the 1.3500 level, the currency pair is targeting its next major downside objective around the 1.3300 support level, last hit in November of 2013, followed by the 1.3100 level, last hit in September 2013.
StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.