- The EUR/USD pair renews its intraday low, while matching its biggest daily advance in two weeks.
- Signals from the RSI and MACD suggest that the bulls are running out of steam.
- May high acts as key upside resistance, bears need ‘golden ratio’ validation.
The EUR/USD pair falls to 1.0640 and renews its intraday low during the first hour of the European session on Friday. Thus, the major currency pair reverses the resistance of the downtrend line of two weeks ago.
The pullback could also be related to bearish MACD signals, which in turn suggest further price weakness.
However, the 10-day EMA around 1.0620 at time of writing caps the short-term fall in the EUR/USD pair.
That being said, the RSI (14) is moving higher around overbought territory, which in turn joins the MACD conditions and the failure to cross the immediate EMA, noted above, to keep sellers hopeful. of the EUR/USD.
Consequently, continued weakness in the price below the 10-day EMA level could gradually drag it towards the previous monthly high near 1.0480.
However, the 61.8% Fibonacci retracement level of EUR/USD’s May-Sept decline near 1.0310, also known as the “golden ratio”, becomes crucial for bears’ conviction.
Conversely, recovery moves remain elusive even if EUR/USD bulls manage to cross the immediate resistance line, around 1.0690 at the latest. The reason could be linked to the pair’s previous pullbacks from the sub-1.0800 zone, signaled in May 2022. Therefore, buyers of the pair need a successful break of the 1.0800 threshold to continue to dominate.
EUR/USD: Daily chart
Trend: Falls are expected
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
