Forex Trading Analysis: Will the downward trend of EUR/USD continue?
On Monday (January 6th) during the European trading session, the EUR/USD failed to stabilize above the level of 1.0420. The euro/dollar further fell below the levels of 1.0380 and 1.0350.
From the 4-hour chart, the euro/dollar closed below the 1.0350 level, the 100 period simple moving average, and the 200 period simple moving average. The euro/dollar fell below the support zone of 1.0300 at one point.
After hitting a low of 1.0223, the euro/dollar is currently attempting to launch a rebound. Its price has slightly increased above the level of 1.0275. The euro/dollar rose above the 23.6% Fibonacci retracement level of the decline from a high of 1.0458 to a low of 1.0223.
On the upside side, the euro/dollar is facing resistance near the 1.0350 level. The first major resistance level is approaching the 1.0380 level. On the same chart, there is another key bearish trend line forming, with resistance at 1.0400.
The next major resistance level is approaching the 1.0420 level. If it closes above the 1.0420 level, it may set the tone for further upward movement. In this situation, the euro/dollar may climb towards the resistance level of 1.0500.
On the downside side, the current support level is approaching the 1.0275 level. The next key support level is approaching the 1.0250 level. If it falls further, it may cause the euro/dollar to drop to the level of 1.0220.
Looking at GBP/USD again, GBP/USD is currently correcting some of its decline, but may encounter resistance near the 1.2450 level.
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