Key Highlights
- The Euro failed to recover this past week and declined below 1.1700 against the US Dollar.
- There is a major bearish trend line in place with current resistance at 1.1710 on the 4-hours chart of EUR/USD.
- The pair remains at a risk of more losses if it fails to recover above 1.1700 and 1.1710.
- The US Durable Goods Orders in April 2018 declined 1.7%, more than the market expectation of -1.4%.
EURUSD Technical Analysis
The Euro extended declines this past week below the 1.1700 support level against the US Dollar. The EUR/USD pair is now trading in the red zone with the next support at 1.1600.
The 4-hours chart of EUR/USD suggests that the pair attempted a recovery on a couple of occasions. There were ascending channels formed, but the Euro buyers failed to gain traction. As a result, the pair moved down and it recently settled below the 1.1700 support level.
It seems like the pair may well accelerate declines towards the next major support at 1.1600. Below this, the pair could test the 1.1550 support zone. On the upside, there is a major bearish trend line in place with current resistance at 1.1710 on the 4-hours chart of EUR/USD.
A proper break and close above the trend line resistance and 1.1700 is required for a substantial recovery in the near term. Above 1.1710, the next resistance awaits at 1.1840.
Recently in the US, the Durable Goods Orders for April 2018 was released by the US Census Bureau. The market was looking for a decline in orders by 1.4%, compared with the last increase of 2.6%.
However, the result on the lower side as there was a decline in orders by 1.7%. The last reading was revised up to 2.7%. Looking at the Durable Goods Orders ex transportation, there was a rise of 0.9%, more than the forecast of 0.5%.
Overall, the EUR/USD pair may correct a few pips in the near term, but upsides are likely to remain capped by 1.1710.
