The EUR/USD pair does not seem to go above the level of 1.1800 and on early Wednesday in Asia, it sank to a new weekly low near 1.1740 as the US Dollar caught some strength. What’s odd is that this happened even though the FOMC Minutes still point to more rate cuts ahead. Right now, the pair is hovering around 1.1760, a touch below where it started the day.
EUR/USD Currency Pair Short-Term Overview: Bears in Control
The 4-hour chart shows that sellers are leading. The EUR/USD rate, on the other hand, trades above this moving average, which is viewed as a resistance between 1.1775 and 1.1780 at the moment (it’s the SMAs just above them in response). Momentum looks bearish but is still moving into negative, and PRICE ACTION remains in range without any break of the 100- or 200-period SMAs at this moment, which are located at 1.1727 AND 1.1658, respectively. The RSI is sticking to the mid-40s, while the momentum indicator continues heading south of its midline. Or, in a word, buyers are frozen. A further drop towards long-term support may occur if the pair breaks below the 100-period SMA.
Daily Chart Shows Less Grim Picture
On a higher daily chart, you see the situation is much less grim. In EUR/USD, the pair continues to trade above all of our major averages. Provided the dynamic support by the 20-day SMA is still in place and is now being located around the zone of 1.1720-1.1725. The 200-day still trends upward, but the 100-day has flattened a tad and may indicate some pause time.. There is still an increase. Momentum readings remain above their midlines even as they cool somewhat. RSI has fallen from recent highs to around 62. Bulls have been humbled, as they’re no longer quite so dominant — the bulls and their power dynamic keep this expectation in check.
What’s Next for the EUR/USD Pair
Keep an eye on Eurozone CPI (YoY at 2.2%), Retail Sales (-1.7% YoY), and US Initial Jobless Claims (220K expected)—these could shake things up. If EUR/USD stays above the 20-period SMA, it’s got a shot at another try at 1.1800. But if it slips under 1.1720, get ready for a deeper pullback.
