Key Highlights
- EUR/USD started a strong decline below the 1.0850 and 1.0750 support levels.
- A key bearish trend line is forming resistance near 1.0865 on the 4-hours chart.
- GBP/USD also fell significantly below 1.1600 and gold price retested $1,475.
- The US Existing Home Sales could increase 0.7% in for Feb 2020 (MoM).
EUR/USD Technical Analysis
This month, the Euro saw a sharp increase in selling interest below 1.1000 against the US Dollar. EUR/USD broke many key supports near 1.0850 to enter a medium term downtrend.
Looking at the 4-hours chart, the pair followed a strong bearish path and declined below the 1.0750 support. Moreover, the pair traded to a new multi-month low at 1.0637 and it settled well below the 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours).
If there is an upside correction, the 1.0750 and 1.0780 levels are likely to act as key hurdles for the bulls. Moreover, there is a key bearish trend line forming resistance near 1.0865 on the same chart.
Therefore, the pair must move back above 1.0850 and 1.0880 to start a decent recovery wave. If not, upsides are likely to remain capped and the pair is likely to resume its decline below 1.0650 and 1.0620 in the coming days.
Looking at GBP/USD, there was a sharp decline below the 1.2000 and 1.1800 support levels. The pair traded to a new multi-month low at 1.1409 and it is now consolidating losses. Conversely, USD/JPY is climbing back towards the 112.20 resistance.
Upcoming Economic Releases
- Chicago Fed National Activity Index for Feb 2020 – Forecast -0.20, versus -0.25 previous.
- Euro Zone Consumer Confidence March 2020 (Preliminary) – Forecast -6.5, versus -6.6 previous.
