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The EUR/USD pair closed at 1.1573, with an intraday high of 1.1574 and a low of 1.1561. It continues to drift lower after failing to sustain gains above the 1.1700 zone. The near-term structure has turned bearish as selling pressure intensifies, with the euro losing ground amid renewed US dollar strength.
Key Technical Observations
Moving Averages Bearish:
The 15-day moving average (1.1701) has crossed below the 20-day moving average (1.1724), confirming a short-term bearish crossover. Both averages are sloping downward, signalling persistent downside pressure.
Trend Structure:
Price action shows a clear lower-high and lower-low formation from the July peak near 1.2000, reinforcing the broader corrective phase. The pair has broken below short-term support around 1.1600, opening the door for a test of the 1.1500–1.1450 demand zone.
RSI Weakness:
The RSI stands at 37.13, approaching oversold territory but still with room to decline. This suggests momentum remains bearish, though some short-term consolidation could occur near the 1.1500 zone.
Support Compression:
The candles are tightening near key support, hinting that a breakout move could occur soon. Sustained closes below 1.1500 would strengthen bearish control.
Macro & Market Context
Dollar Index (DXY) Recovery:
The DXY has stabilized near 97.60, lending renewed support to the greenback and exerting pressure on the euro.
ECB vs Fed Divergence:
The European Central Bank’s cautious tone contrasts with the U.S. Federal Reserve’s relative firmness, maintaining a yield advantage in favour of the dollar.
Eurozone Data Softness:
Recent weaker industrial and sentiment indicators out of the Eurozone weigh on the common currency, reinforcing the downward bias.
Key Levels to Watch
- Immediate Resistance: 1.1650 – short-term pullback zone.
- Next Resistance: 1.1750 – cluster of moving averages.
- Immediate Support: 1.1500 – psychological and structural base.
- Deeper Support: 1.1450 – 50% retracement of the previous rally.
Bias: Bearish
The pair remains under pressure, and the downside bias will persist as long as it trades below 1.1700. A break below 1.1500 would confirm a deeper retracement toward 1.1450–1.1400. Only a sustained move above 1.1750 would neutralize the current bearish setup.
The current outlook favours sell-on-rally opportunities, ideally near 1.1650–1.1700, with targets at 1.1500–1.1450 and stops above 1.1750. Traders should watch for RSI stabilization near 35 as a potential early signal for a rebound attempt, but momentum remains decisively with the sellers for now.
