EUR/USD drops like a rock in the short term as the DXY has managed to rebound signaling that it has ended its retreat. Technically, the currency pair invalidated a potential strong growth. Still, the rate moves somehow sideways, so we still need strong confirmation before taking action.
Fundamentally, the USD was somehow expected to appreciate versus its rivals after the Flash Manufacturing PMI and Flash Services PMI announced expansion, while the CB Consumer Confidence was reported at 110.5 points above 109.9 expected in yesterday's session.
Today, the eurozone Final CPI rose by 5.1% matching expectations, while the Final Core CPI registered a 2.3% growth as expected. Unfortunately for the Euro, the German Gfk Consumer Climate was reported at -8.1 versus -6.2 expected.
EUR/USD Strong Bearish Pressure!
EUR/USD failed to stabilize above the 38.2 (1.1345) retracement level and above the triangle's support indicating strong bearish pressure. Now, it challenges the 50%retracement level and the median line (ML).
A new lower low could activate more declines. Still, in the short term, we cannot exclude a sideways movement. Only new false breakdowns below the median line (ML) and under the 1.1279 could indicate potential bullish momentum.
EUR/USD Prediction!
In the short term, the pair came back to test and retest the upside obstacles. Dropping and closing below 1.1279 could validate a downside continuation and could bring new short opportunities.
