EUR Q2 2021 Technical Forecast

Former Congestion Space Sufficient to Cease Downtrend Continuation?

The Euro has bought off in dramatic style in opposition to the US Greenback, with EUR/USD aiming to finish its third consecutive month-to-month loss. Nonetheless, the forex pair has entered a zone of congestion (1.1630 – 1.1904) that would present a attainable space of help. Nonetheless, with momentum to the draw back seemingly rising, costs could but pierce under this hurdle.

Ought to the help zone give means, EUR/USD could get its subsequent likelihood for respite close to the 1.1412 stage. On the weekly timeframe, the MACD indicator is rising more and more bearish, evidenced by the histogram’s acceleration decrease. The oscillator’s centerline can also be in peril of being breached. The final such prevalence preceded a chronic selloff.

EUR/USD Weekly Chart

Chart crated with TradingView

Zooming out to the month-to-month timeframe reveals EUR/USD’s bearish worth motion since making an all-time excessive in 2008, with a break and retest of resistance-turned-support previous the January swing excessive. That coincided with a previous stage of main help. Costs have pushed decrease since, and trendline help seems to be within the crosshairs as soon as extra.

The 38.2% Fibonacci retracement and 2016 excessive could provide intermittent ranges for worth to cogitate. A break under help is prone to renew bearish vigor. Even so, costs could very effectively proceed to float decrease even when help holds. All issues thought of, EUR/USD’s downward push would possibly sluggish considerably, however with out a break above the 1.2231 aircraft, a downbeat outlook stays.

EUR/USD Month-to-month Chart

Chart crated with TradingView

— Written by Thomas Westwater, Analyst for DailyFX.com

To contact Thomas, use the feedback part under or @FxWestwater on Twitter