EURUSD Resumes Bearish Trend, Traders Brace for Further Downside Potential!

Amidst the EURUSD trading landscape, a clear bearish trajectory has emerged, with prices consistently tracking lower beneath the EMA 50, 200, and a descending trendline. The recent downturn, initiated from Friday's peak at 1.0896, witnessed a substantial 170-pip decline, highlighting the dominance of bearish sentiment.

In recent sessions, the market experienced a temporary pullback, marked by the formation of a short-term ascending trendline. However, during today's European trading session, a decisive break below this trendline has signaled the resumption of the bearish trend, suggesting further downward movement.

Examining key technical indicators, the EMA 50 and 200 are both inclined downwards, with an increasing separation between the two lines indicative of robust downward momentum. Similarly, the Bollinger Bands reveal that despite a brief rebound from yesterday's low, prices have failed to breach the upper band, signaling a possible continuation of the bearish trend, particularly if prices breach the lower band.

Analyzing the MACD and RSI further reinforces the bearish outlook, with both indicators aligning to reflect downward pressure. The MACD signal line resides below the 0 level, while the RSI struggles to maintain its position within a bearish zone, oscillating between 0% and 60%.

In summary, the EURUSD trend remains firmly bearish, with considerable downward momentum suggesting a continuation of the current trajectory. Traders should remain vigilant for further downside movements as the bearish sentiment prevails.

Key Takeaways:

1. EURUSD remains entrenched in a bearish trend, characterized by consistent downward movement under key technical indicators including the EMA 50, 200, and a descending trendline.
2. A recent pullback in prices, marked by the formation of a short-term ascending trendline, proved short-lived as the market swiftly broke below this trendline during the European trading session.
3. Technical indicators such as the EMA 50 and 200 underscore the strength of the bearish momentum, with widening separation between these lines indicating sustained downward pressure.
4. Despite a temporary rebound from yesterday's low, the failure to breach the upper band of the Bollinger Bands suggests the likelihood of a continued bearish trajectory, especially if prices breach the lower band.
5. Both the MACD and RSI indicators corroborate the bearish sentiment, with the MACD signal line below the 0 level and the RSI struggling to maintain bullish territory, signaling further downside potential. Traders should exercise caution and monitor for continued bearish signals in EURUSD trading.

Key Economic Releases to Watch Today

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CAD, Ivey PMI (Jan)   

Forecast 55.0 vs Previous 56.3

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