Market Analysis – EURUSD Keeps Sliding and Trading Downwards
EURUSD keeps moving down in a bearish trend after the latest bullish move broke down. Price had switched direction bearish-ward at the beginning of the year after attaining a 3year high at 1.23500. Since then, the market has been sliding down. Buyers tried to step in to influence a change in direction, but the bullish move eventually broke down and the price kept falling and trading in and around the oversold region.
EURUSD Significant Levels
Resistance Zones: 1.19100, 1.18400, 1.17560
Support Zones: 1.17100, 1.16550, 1.16200
The most significant effort by the buyers to change the direction of the market came on the 19th of April 2021. EURUSD moved above the downtrend line and bounced up from the 1.19930 and 1.20660 key levels before moving above 1.21460. The market would go on to test the 1.22700 price level. Success at this level would have remarkably returned the market to its 3year high at 1.23500 in just 100 trading days. But Bulls’ resolve weakened and the price fell abruptly.
EURUSD fell 3.50% down to 1.18400, at which point, the market continued undulating downwards through a channel. The downtrend has continued for 67 days now. Despite the downtrend, the RSI (Relative Strength Index) has been ranging between the 50 mark and the border of the oversold region. Meanwhile, the Stochastic Oscillator is plunging in and out of the oversold region. Bears generally have the stronghold on the market.
Market Expectations
On the 4-hour chart, the market is rising after bouncing off the lower border of the descending channel. This has moved the RSI signal line past the 50 mark and is approaching the overbought region. The Stochastic Oscillator, though, has already climbed deep into the oversold region. Price may potentially drop at the 1.17450 resistance because any simple trigger in the bearish direction will plunge the market. After all, bears generally have the upper hand.
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