EUR/USD Steps Below 200-Day SMA

You may recall that the Research Team released a post on the EUR/USD at the end of August, detailing that upside momentum may be waning. https://www.fpmarkets.com/blog/upside-momentum-waning-on-eur-usd/

As evident from the monthly chart, the currency pair wrapped up August down -1.3%, following a reaction from resistance at $1.1233 in July, a level boasting a connection with the 50-month simple moving average at $1.1167. Further underperformance is possible, according to the monthly chart, with support not expected to make a show until $1.0516.

Adding to this bearish vibe from the monthly chart, we can see that on the daily timeframe, price action recently dipped a toe in waters south of the 200-day simple moving average at $1.0817. Traders and investors, therefore, may view this as a sign that further underperformance could be observed this week, zeroing in on daily support at $1.0689 as a viable downside objective.

From a shorter-term perspective, the H1 timeframe shows price recently whipsawed north of the $1.08 level and touched resistance from $1.0809. To the downside, the $1.0772 low (4 September) is a possible support target in the short term, closely shadowed by the lows around $1.0766 (25 August), both of which are circled. Now, if we should surpass the aforementioned lows, as suggested by the higher timeframes showing that the unit could explore territory as far south as daily support at $1.0689, H1 support calls for attention at $1.0746.

For the time being, therefore, EUR/USD offers a technically bearish environment.

Charts: TradingView

DISCLAIMER:

The information contained in this material is intended for general advice only. It does not take into account your investment objectives, financial situation or particular needs. FP Markets has made every effort to ensure the accuracy of the information as at the date of publication. FP Markets does not give any warranty or representation as to the material. Examples included in this material are for illustrative purposes only. To the extent permitted by law, FP Markets and its employees shall not be liable for any loss or damage arising in any way (including by way of negligence) from or in connection with any information provided in or omitted from this material. Features of the FP Markets products including AAPLicable fees and charges are outlined in the Product Disclosure Statements available from FP Markets website, www.fpmarkets.com and should be considered before deciding to deal in those products. Derivatives can be risky; losses can exceed your initial payment. FP Markets recommends that you seek independent advice. First Prudential Markets Pty Ltd trading as FP Markets ABN 16 112 600 281, Australian Financial Services License Number 286354.