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EUR/USD Breaks Below Important Support
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On Wednesday, EUR dropped to 1.3305 against USD as investors remained worried a possible US military action against Syria. EURUSD currency pair, however,
- On Wednesday, EUR dropped to 1.3305 against USD as investors remained worried a possible US military action against Syria. EURUSD currency pair, however, managed to pull-back from day’s low after release of downbeat US pending home sales data. The pair finally settled at near 61.8% Fibonacci Retracement Level of 1.3710 – 1.2746 downfall.
- On Thursday, EUR slipped further against USD, falling below 1.3250 to 1.3242, and is currently trading at 1.3259 ahead of the Preliminary estimate of US GDP for the second quarter of 2013, scheduled for release today. Also read: US GDP Update And Syria Conflict In Focus
- The pair has failed to hold 1.3300 – 1.3280 support marked by the lower trend-line of an ascending channel formation on daily chart. The pair now seems to drift lower towards a very strong support that has emerged near 1.3200 zone, also coinciding with 50% retracement level.
- Should the pair weaken below 1.3200 strong support zone, the pair could easily depreciate towards its intermediate support near 1.3130-1.3140 zone, consisting of 200-day SMA and 38.2% Fibonacci Retracement Level of 2011-2012 downfall.
- Further, a decisive break below 1.3200 could possibly trigger near-term weakness for the currency pair towards a very important psychological support of 1.3000 level.
- On the upside, 1.3300 area, previous support, may now act as immediate resistance for the currency pair. This is likely to be followed by resistance near 1.3340 region, representing 61.8% retracement level.
- Considering that the pair has decisively weakened below the ascending channel formation, that was held since the second week of July, the pair seems vulnerable to a fresh leg of downfall towards testing the 200-day SMA support.
About the Author
Haresh Menghaniauthor
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