EUR/USD edged up yesterday at 1.2017 high with failure to hold 1.200 level and plunged to 1.1923 low. Today, the EUR bears are still dominating after dipping to 1.1929, still inside yesterday's lower wicks and flirting with 20-EMA level.
Technically, EUR/USD closed below 5-EMA and 10-EMA yesterday forming a shooting star daily candle which indicates further dips aimed at 1.1860+ (50-EMA) in case testing 20-EMA failed. On the chart, we can notice that 5-EMA is crossing with 10-EMA from above which supports a further downtrend in the coming hours.
On the other hand, the DXY dropped to 91.64 low after reports stated that China is showing lesser interest in U.S treasury bonds. Later on, reports by Reuters mentioned that such news could be fake, as a result, the greenback made a strong come back with 92.26 high, adding more pressure on EUR/USD.
As for macro economics, today ECB minutes will be in focus and the Eurozone future projections regarding monetary policy. Shortly after that, U.S will release Producer Price Index and Core PPI.
EUR/USD technical overview:
Closing price: 1.1956
Target price: 1.1880-90
Resistance levels: 1.1970, 1.2000, 1.2030*
Support levels: 1.1925, 1.1890
Trend reversal price: 1.2030
Comment: The market is staying in a short term downturn. Yesterday's rejection from just under 1.2030* key resistance reinforces the negative trend bias and warns for a slip lower over the next few days. A close below 1.1890 could open up a larger selling wave. A close over 1.2033* is needed for a reversing turnaround.