The EUR / USD pair, in 4-hour charts, is trading below the 21 SMA and below the strong resistance of 2/8 of murray located at 1.1840. The Euro is under downward pressure and could continue with this movement down to the murray 0/8 support located at 1.1718 and 1.1690.
Risk aversion in the markets is causing the US Dollar to strengthen. In this context, the US dollar Index (USDX) is trading at highs since the beginning of April above 93.10. The uptrend is likely to continue to the resistance zone of 93.75 (8/8).
If the dollar index (USDX) continues with its uptrend, the EUR / USD pair could easily fall to the support zone of 1.1718 and deeper to 1.1690 support zone of the bearish channel and level of 0/8 of murray.
On Thursday, the European Central Bank (ECB) will announce its monetary policy decisions. Market participants are speculating that the ECB could make some kind of policy change. This was hinted by ECB President Christine Lagarde recently, although the probability of a radical change seems very low.
According to the chart, the Euro has strong resistance above 1.18 to 1.1840. A pullback towards this area will be a good opportunity to sell due to the downward pressure of the market and the strength of the dollar.
A sharp break of the 2/8 murray resistance located at 1.1840 could turn the euro downward and there could be a move up to the 1.1945 resistance zone of the 200 EMA and 1.1962 (4/8).
Our recommendation is to sell below 1.1802 or if it pulls back to the top of the bearish channel, with targets at 1.1718 and 1.1690. The eagle Indicator is in the overbought zone and is showing a bearish signal.
Support and Resistance Levels for July 20 - 21, 2021
Resistance (3) 1.1866
Resistance (2) 1.1825
Resistance (1) 1.1794
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Support (1) 1.1753
Support (2) 1.1713
Support (3) 1.1641
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Trading tip for EUR/USD for July 20 - 21, 2021
Sell below 1.18010 (SMA 21), with take profit at 1.1718 (0/8) and 1.1690, stop loss above 1.1840.
