Red lines- bearish channel
Black lines- Fibonacci retracements
Today's announcement of the MoM CPI surprised the market which had been expecting a decline of 0.01%, but instead we got a rise of 0.1%. This occurred on time when price was challenging the key Fibonacci retracement level we noted in previous posts. EURUSD got rejected at the 61.8% Fibonacci retracement. As can be seen in the Daily chart above, bulls tried yesterday and today to break the 61.8% Fibonacci retracement. This is very important resistance. At this retracement level we usually see reversals in trend. Today this rule has been confirmed. Today's price action confirms the importance of the resistance at 1.02. We remain bearish as long as price is below 1.02. A break above 1.02 will push EURUSD towards 1.04 at least.
