Key Highlights
- EUR/USD extended losses and traded below 1.0650.
- A key bearish trend line is forming with resistance near 1.0700 on the 4-hour chart.
- GBP/USD is diving and trading below the 1.2350 level.
- USD/JPY is eyeing more gains above the 148.50 level.
EUR/USD Technical Analysis
The Euro started a fresh decline after it failed to clear 1.0750 against the US Dollar. EUR/USD dropped below 1.0700 and 1.0650 to move further into a bearish zone.
Looking at the 4-hour chart, the pair settled below the 1.0700 level, the 100 simple moving average (red, 4 hours), and the 200 simple moving average (green, 4 hours).
A new multi-week low was formed near 1.0614 and the pair is now consolidating losses. It is now facing resistance near the 1.0675 level. It is close to the 50% Fib retracement level of the recent decline from the 1.0737 swing high to the 1.0614 low.
The next major resistance is near the 1.0700 zone. There is also a key bearish trend line forming with resistance near 1.0700 on the same chart.
A close above 1.0700 could start a steady increase toward 1.0750. Any more gains might send EUR/USD toward the 1.0820 resistance. On the downside, initial support is near the 1.0610 level. The next key support is seen near the 1.0550 level, below which it could test 1.0500.
If there is a move below 1.0500, the pair could dive toward 1.0440. Any more losses might send the pair toward the 1.0350 level.
Looking at GBP/USD, there were strong bearish moves and the pair even declined below the 1.2350 support zone.
Economic Releases
- German IFO Business Climate Index for Sep 2023 – Forecast 85.2, versus 85.7 previous.
- German IFO Current Assessment Index for Sep 2023 – Forecast 88.0, versus 89.0 previous.
- German IFO Expectations Index for Sep 2023 – Forecast 82.8, versus 82.6 previous.
