Looking at the EUR/USD daily graph ForexSQ exprets see that the uptrend that started on 25th of July ended on August 18th. 50% Fibo retracement of that move is around 1.1155/60 and as the pair continues to stay below that level 1.11 area (Fibo 61.8% retracement) and 1.1040 (Fibo %78.6 retracement) can be targeted with the help of positive NFP numbers. It is also possible for the pair to test 1.09 area before September’s FOMC meeting.
Even if we see below consensus NFP the downward may continue after a short term upward spike especially after seeing (on August 31st) how CPI and core CPI for Eurozone is respectively at 0.2% and 0.8%. 1.1200/10 area where the linear regression channel and Fibo 38.2% retracement is sitting may act as the first short term resistance level. In case this resistance is violated Fibo 23.6% retracement around 1.1265 seems as a harder obstacle to overcome.
RSI on daily graph is around 42 and shows that there is more space for the pair to keep going down. Pair may go for a short covering if RSI comes close to extreme oversold levels. The last time daily RSI went below 30 was at the end of November of 2015. 100 DMA (red line) also technically supports the continuation of downward movement.
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Even if we see below consensus NFP the downward may continue after a short term upward spike especially after seeing (on August 31st) how CPI and core CPI for Eurozone is respectively at 0.2% and 0.8%. 1.1200/10 area where the linear regression channel and Fibo 38.2% retracement is sitting may act as the first short term resistance level. In case this resistance is violated Fibo 23.6% retracement around 1.1265 seems as a harder obstacle to overcome.
RSI on daily graph is around 42 and shows that there is more space for the pair to keep going down. Pair may go for a short covering if RSI comes close to extreme oversold levels. The last time daily RSI went below 30 was at the end of November of 2015. 100 DMA (red line) also technically supports the continuation of downward movement.
Read More at www.ForexSQ.com goo.gl/oyUeIF