After being rejected from the 1.1387 resistance level, EURUSD remains below the 20-day simple moving average (SMA) in the short-term. The pair is still trading well below the long-term descending trend line, while the technical indicators seem to face contradicting signals. The RSI is still below 50 and is pointing down; however, the MACD is heading upwards despite being in the negative sector and above its red trigger line.
It may be difficult to overcome the significant resistance area between the 20-day SMA at 1.1330 and the 1.1387 barrier. Higher up, the price may reach the 23.6% Fibonacci retracement of the down leg from 1.2348 to 1.11185 at 1.1460 ahead of the 1.1520 resistance level, which overlaps with the downtrend line. The 38.2% Fibonacci retracement level of 1.1630 could be tested if the price breaks through the aforementioned line.
The 1.1015 support, taken from the inside swing high of April 2020, may be the next target if sellers can close decisively below the 16-month low of 1.1185. The 1.0765 barrier may be the next hurdle for bears to overcome if they dive below the latter level.
Overall, the long-term outlook for EURUSD is bearish. The current outlook may shift to neutral if the descending line and the 200-day SMA are breached.
