- EUR/USD posts 6 red sessions
- Price plunges below 1.1000
- Stochastics indicates upside recovery
- But RSI keeps falling
EUR/USD plummeted more than 2% after the pullback from the double top around 1.1200, recording six straight red days. The price also tumbled beneath the short-term uptrend line and the 1.1000 round number, confirming the bearish correction in the near term.
The RSI indicator is falling beneath the neutral threshold of 50; however, the stochastic is suggesting the end of the negative retracement as it is posting a bullish cross within its %K and %D lines in the oversold territory.
If the selling interest continues, then the market may re-challenge the strong flat 200-day simple moving average (SMA) at 1.0870 before resting near the medium-term ascending line at 1.0800.
In the positive scenario, a climb back above the 1.1000 round number could add some optimism for bullish actions until the 50-day SMA at 1.1050, ahead of the 1.1070 resistance level. A slightly higher jump above the 20-day SMA at 1.1090 could pave the way for another test of the 1.1200-1.1215 restrictive region.
To sum up, EUR/USD has been in a dilemma about whether the bearish correction would be deeper or whether the end of the correction is near. In the broader outlook, the price is still in a bullish area.