EURUSD remains under pressure and risk is still to the downside as prices continue to drift lower from the 23.6% Fibonacci retracement level of 1.2020 of the upleg from 1.0340 to 1.2540, which is acting as strong resistance level for the bulls. The short-term technical indicators are bearish and point to more weakness in the market.
Looking at the daily timeframe, the Relative Strength Index (RSI) is holding in oversold levels but is flattening, while the MACD oscillator is falling with strong momentum below the trigger and zero lines, signaling further losses. Also, the 20- and 40-simple moving averages (SMA) are moving lower following the price action.
The next target to the downside is the December 2017 high of the 1.1900 strong psychological level. At this stage, the market would likely see a resumption of the downtrend and re-challenge the 1.1720 support level, which stands near the 38.2% Fibonacci mark.
Upsides moves are likely to find resistance at the 23.6% Fibonacci of 1.2020. Rising above this area would help shift the focus to the upside towards the 1.2080 resistance barrier. Breaking this level could see a re-test of the 1.2160 hurdle and turn the bias to bullish.
In the short-term, the bearish phase remains in play especially if prices continue to trade below the 23.6% Fibonacci mark. In the bigger picture, the pair posted three negative weekly sessions and is in the process to turn the bullish outlook to bearish.
