The EUR/USD pair drops like a rock and it seems determined to approach and reach new lows. It's trading at 1.0546 far below today's high of 1.0614. You knew from my previous analyses that the currency pair could extend its sell-off.
Fundamentally, the Eurozone and US data came in mixed today. Still, the US data had a big impact, the EUR/USD pair accelerated its sell-off after the data dump. The US Core PCE Price Index rose by 0.6% beating the 0.4% growth expected, while Personal Spending registered a 1.8% growth compared to 1.4% growth expected. Personal Income came in worse than expected, but the USD could still get support from the New Home Sales and from Revised UoM Consumer Sentiment.
EUR/USD Massive Drop!
As you already know, the bias was bearish after registering only false breakouts above the downtrend line. The 1.0585 represented a critical downside obstacle. Breaking below it activated more declines.
You also knew that the weekly S2 (1.0510) and the channel's downside line represent downside targets.
EUR/USD Outlook!
Today's breakdown below 1.0585 was seen as a selling opportunity. The bias is bearish, so the S2 of 1.0510 represents the first downside target. A larger drop could be activated only by a valid breakdown below it.
