- EURUSD stuck in a clear downward path, seems unable to recover
- Latest rebound encounters strong resistance at key trendline
- Momentum indicators endorse a resumption of the downtrend
EURUSD has been in a steady retreat after peaking at the 18-month high of 1.1275, generating a series of lower highs and lower lows. Although the pair managed to find its feet at the 10-month bottom of 1.0447, its recovery faltered after hitting the descending trendline that connects its recent lower highs.
Should the bears attempt to push the price lower, the September support of 1.0487 could prove to be the first barrier for the pair to clear. A violation of that floor could pave the way for the 10-month low of 1.0447. Piercing through that region, the price might then slide towards the November 2022 support zone of 1.0289.
On the flipside, if the pair reverses back higher, initial advances could be rejected by the downward sloping trendline ahead of the recent resistance region of 1.0638. Conquering this barricade, the bulls could aim for the September resistance of 1.0765. Failing to halt there, the pair could then ascend towards the June-July support of 1.0832, which may serve as strong resistance in the future.
In brief, EURUSD remains a prisoner within its medium-term bearish pattern as its latest bounce proved to be short-lived. Hence, it’s clear that a break above its descending trendline is needed to revive the bulls’ hopes for a solid recovery.