EUR/USD Price Forecast – Euro Breaks Significantly Lower

The Euro has broken down rather significantly during the trading session on Wednesday, as the 1.10 level has offered quite a bit of resistance. A break down suggests that we are continuing the longer term downtrend, and the length of the candlestick certainly suggests that we are going to run out of buyers in the short term. The question now is whether or not we can break down below the lows that we just formed about 10 days ago. By breaking through that level, then it opens up the door to the 1.0650 level. Rallies at this point I believe continue to get sold into, as the Euro has so much to worry about when it comes to the European Union. Furthermore, there is still quite a bit of demand for US dollars out there, despite what the Federal Reserve has done.

EUR/USD Video 16.04.20

Don’t get me wrong, I don’t think that this is a meltdown waiting to happen, but the size of the candle shows quite a bit of negativity. I think there will be some continuation, so short-term rallies will probably be sold into on smaller time frames. If we did break down below the 1.0650 level, it would open up the door to the 1.05 level after that. I believe that the market is going to continue to be very noisy in general but clearly the 1.10 level has seen enough selling pressure that the market will clearly remember that level again every time we get there. Because of this, I think we have put a short-term selling in the market but that doesn’t mean that it’s a plunge straight down.