The EUR/USD pair plunged in the short term after failing to take out the 1.0353 upside obstacle. After its massive drop, a temporary rebound was natural. It could try to test and retest the near-term downside obstacles before dropping deeper.
Fundamentally, the eurozone data came in worse than expected today. The Flash GDP rose by 0.6% versus the 0.7% growth expected, while the Flash Employment Change surged by 0.3% versus the 0.4% growth forecasted.
On the other hand, the US economic data came in mixed. The Retail Sales indicator rose by 0.0% versus the 0.1% expected, while the Core Retail Sales surged by 0.4% while traders expected a 0.1% drop.
Later, the FOMC Meeting Minutes could really shake the market. The report could change the sentiment. More hawkish than expected minutes could help USD to appreciate.
EUR/USD Minor Rebound
EUR/USD found support above 1.0119 and now it has rebounded. Still, 1.0194 stands as a strong upside obstacle. The price registered only a false breakout with great separation above this level, signaling strong downside pressure.
It continues to challenge the median line (ml) and the S1 (1.0150) which represent downside obstacles. Technically, the 1.0119 level represents critical support.
EUR/USD Outlook
The EUR/USD pair could activate a larger downside movement if it drops and closes below the 1.0119 support. A valid breakdown could bring new short opportunities.
