EUR/USD saw a decline from 1.1213 last week, but managed to bounce back after reaching 1.0810. The initial bias for this week remains neutral for consolidations. However, the outlook will remain bearish as long as the resistance at 1.0954 holds. If the pair falls below 1.0810, the decline from 1.1213 is expected to continue towards the 61.8% retracement level at 1.0740. A significant break below that level could target the next support at 1.0601.
Looking at the bigger picture, the price movements from the 1.1274 high in 2023 are viewed as a consolidation pattern within an uptrend from the 0.9534 low in 2022, with the recent fall from 1.1213 considered as the third leg. The downside movement is expected to be limited by the 50% retracement level at 1.0404, which could lead to a resumption of the uptrend in the future.
In the long term perspective, there seems to be a bottom established at 0.9534 in 2022. However, the EUR/USD pair is currently facing challenges in maintaining levels above the 55-day Exponential Moving Average (EMA) at 1.1011. The overall outlook for the pair is uncertain at this point, with a neutral stance being the best option for now.
It will be interesting to monitor how the pair reacts in the coming days and whether it can break above the key resistance levels to signal a potential reversal in the bearish trend. Traders and investors will be closely watching the technical indicators and key support levels to gauge the future direction of the EUR/USD pair. Market participants should remain cautious and stay informed about any developments that could impact the currency pair’s movements in the forex market.
