Yesterday, EURUSD experienced a significant downturn, marked by a substantial bearish engulfing candlestick that led to a nearly 50-pip drop in prices. This decline coincided with a break below the ascending trendline, signaling a shift in market sentiment. Today, EURUSD continues to face resistance near the key level at 1.0780, struggling to reclaim ground above the ascending trendline. Despite attempts to resume an upward trajectory, the market appears to be encountering resistance in its ascent.
In the realm of economic news, today's focus lies on CPI data. Forecasts anticipate a slowdown in both monthly and yearly CPI figures, with CPI year-over-year projected at 2.9% compared to the previous 3.4%, and CPI month-over-month forecasted at 0.2% versus the prior 0.3%.
From a technical perspective, EURUSD remains constrained below the upper Bollinger band, signaling potential further downside movement. Even attempts to breach the middle band have been met with resistance, suggesting a continuation of the bearish trend.
Both the EMA 50 and 200 are exhibiting signs of expansion, indicating a resurgence in bearish momentum. However, it's worth noting that the gap between these moving averages is not as wide as observed in previous weeks, suggesting a possible limitation to the downward movement.
Examining oscillator indicators, both the RSI and MACD portray bearish signals. The MACD signal line remains below the zero line, while the RSI has dipped below the 50% threshold. A reversal in momentum may be signaled by the MACD signal line crossing above the zero level and the RSI climbing back above 60%.
Overall, the outlook for EURUSD leans bearish, with the recent trendline break and the presence of a bearish engulfing candlestick suggesting a return of bearish sentiment in the short term. Traders should monitor key levels and economic data releases for further insights into market direction.
EURUSD experienced a notable bearish reversal signaled by a significant drop and a break below the ascending trendline following a large bearish engulfing candlestick.
Despite attempts to regain ground above the ascending trendline, EURUSD faces resistance near the key level at 1.0780, suggesting ongoing bearish pressure.
Today's focus is on CPI data, with forecasts anticipating a slowdown in both monthly and yearly CPI figures, potentially influencing market sentiment.
Technical analysis indicates EURUSD remains constrained below the upper Bollinger band, with the EMA 50 and 200 showing signs of expanding, signaling a resurgence in bearish momentum.
Oscillator indicators, including the MACD and RSI, portray bearish signals, with the potential for a reversal in momentum contingent on the MACD signal line crossing above zero and the RSI climbing back above 60%.
Forecast 0.3% vs Previous 0.3%
Forecast 2.9% vs Previous 3.4%
Forecast 0.2% vs Previous 0.3%
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