Key Highlights
- EUR/USD formed a short term top near 1.1494 and declined more than 300 pips.
- There was a break below a key bullish trend line at 1.1135 on the 4-hours chart.
- GBP/USD declined heavily below 1.2500 and AUD/USD nosedived below 0.6250.
- The NY Empire State Manufacturing Index could decrease from 12.9 to 8.7 in March 2020.
EUR/USD Technical Analysis
The Euro failed to hold the key 1.1250 and 1.1200 support level against the US Dollar. EUR/USD even broke the 1.1150 support and it is now struggling to recover.
Looking at the 4-hours chart, the pair declined more than 300 pips in the past few days. During the decline, it broke the 50% Fib retracement level of the key upward move from the 1.0777 low to 1.1494 high.
Moreover, there was a break below a key bullish trend line with support near 1.1135. The pair even tested the 1.1050 support and the 100 simple moving average (red, 4-hours).
The next major support is seen near the 1.1000 area and the 200 simple moving average (green, 4-hours). If there is a daily close below the 1.1000 support area, EUR/USD could continue to move down towards the 1.0920 and 1.0850 support levels.
Conversely, the pair could start a decent recovery above the 1.1150 and 1.1180 levels. The main resistance on the upside is near the 1.1250 level, above which the pair might recover to 1.1350.
Overall, the market sentiment is quite bearish considering the current coronavirus scare. Almost all major pairs are declining, including GBP/USD, AUD/USD and NZD/USD. Gold price also moved down and traded below the $1,550 support.
Upcoming Economic Releases
- German Buba Monthly Report.
- NY Empire State Manufacturing Index for March 2020 – Forecast 8.7, versus 12.9 previous.
