Overview :
- Pair : EUR/USD
- Pivot point : 1.1705
- Trend : downtrend - strong.
The EUR/USD pair dropped perfectly, remain bearish for a further drop. In consequence, the EUR/USD pair is still trading between the levels of 1.1798 and 1.1612.
Last week, the trend reached the level of 1.1612, which was the lowest price for the pair on record since 10th July of 2020. The market closed at the level 1.1631.
The weekly range of the EUR/USD pair is 260 pips. Considering, the range is the difference between the highest (1.1872) and lowest (1.1612) price that it is registered during a particular trading period.
The pivot point has been set at the price of 1.1705 (blue horizontal line). Because of the market opened below the pivot point, we expect a strong continuation of the descending channel today.
Immediately, the pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point.
If the EUR/USD pair fails to break through the pivot point level of 1.1705, the market will decline further to 1.1600. This would suggest a bearish market because the RSI indicator is still in a negative area and does not show any trend-reversal signs.
RSI (14) has made a recent bearish way out which is in line with the bearish outlet we are seeing in price.
Equally important, the RSI is still signaling that the trend is downward as it remains strong below the moving average (100). This suggests the pair will probably go down in coming hours.
The pair is expected to drop lower towards at least 1.1538 with a view to test the first support level.
conversely, if a breakout takes place at the resistance level of 1.1705 (pivot), then this scenario may become annulled.
Reason for the forecast (technically)
It will be good deal to sell at 1.1700 with the first target of 1.1603. It will also call for a downtrend in order to continue towards 1.1538. The weekly strong support is seen at 1.1538. On the contrary, the stop loss should always be taken into account, for that it will be reasonable to set your stop loss at the level of 1.1798 (R1).
