The EUR/USD pair crashed in the short term and now is trading at 1.0980. It has turned to the downside after reaching 1.1027 yesterday's high. After such an impressive growth, temporary retreat was natural. It could test and retest the near-term support levels before jumping higher.
Fundamentally, the currency pair dropped as the German ZEW Economic Sentiment was reported at -14.7 points versus -10.7 expected, while Eurozone ZEW Economic Sentiment came in at -12.2 below -10.2 points forecasted. Tomorrow, the US inflation figures and the BOC could really shake the price.
EUR/USD Natural Retreat!
The EUR/USD pair found strong resistance right above the weekly R1 (1.1020) and now is almost to hit the 1.0976 and the median line (ML). These represent strong downside obstacles.
Technically, as long as it stays above the median line (ML), the bias is bullish and the pair could extend its growth.
EUR/USD Forecast!
Testing and retesting the median line (ML) of the ascending pitchfork, registering false breakdowns below the confluence area formed at the intersection between 1.0976 and the median line represents a new buying opportunity. A larger growth should be activated after jumping and closing above 1.1027. The upside scenario could be invalidated if the rate drops and stabilizes below the median line (ML).
