EUR/USD plummets through support
The pair took a surprising turn lower yesterday, following what looked like a textbook upside flag breakout. However, instead we saw the pair flush through both 1.1348 and crucially the 113.15 swing low too.
This brings about the possibility that we are going to see 1.1388 mark the top of this whole two month rally, should price break below last week’s low of 1.1234. For now, this consolidation seems most likely to break lower given the bearish entry.
However, with the medium-term uptrend still in play, a like-for-like rally could also be on the cards. Thus it seems sensible to await a breakout to dictate directional bias.
A closed hourly candle above 1.1306 would look for a move higher, with 1.1315 and 1.1335 the next resistance levels. Conversely, a closed hourly candle below 1.1286 would look towards 1.1273, 1.1246 and 1.1234 as the next key support levels.