CFDs are a leveraged product and can result in losses that exceed deposits. Please ensure you fully understand how CFDs work and what their risks are, and take care to manage your exposure. CFDs are a leveraged product and can result in losses that exceed deposits. Please ensure you fully understand how CFDs work and what their risks are, and take care to manage your exposure.

EUR/USD technical analysis: breaking important support levels

EUR/USD is starting to trade below a couple of major thresholds, outlook turning increasingly bearish.

EUR/USD Technical Outlook

  • EUR/USD below March trend line
  • Price also below the September high
  • Outlook turning increasingly bearish

The EUR/USD is currently trading below the trend line running higher since March that passes under the November low. In confluence with this trend line is the September high at $1.2011, making the current break a potentially important one. A little more separation is needed, i.e. a strong daily close below $1.2011.

At the time of this writing the price is under, but not in a really convincing manner. That could be about to change. In the event we see a strong push under confluent support, the next area of support arrives around the $1.1920/$1.1885 area, where both price and a channel line run into one another.

Tactically speaking, a solid close below support clears a bearish trading bias down to support where a bounce may offer another potential entry for those seeking to trade a breakdown followed by a pullback entry point. With major support broken, an eventual move to the 200-day could be in order. It is currently at $1.1683 and rising.

From the standpoint of a bullish trading outlook. If the breakdown were to be rejected at confluent support either today or very soon, then a good line in the sand may offer solid risk/reward for those looking for trend resumption from the March low. The next spot to watch should broader support fail will be the $1.1920/$1.1885 area.

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