EURUSD Bearish gap covered on Tuesday but the Market is still indecisive. The price rejected 1.1500 area recently with a strong Bearish engulfing bar. Let’s check EURUSD Technical Analysis for more levels and insights.
March 11, 2020 | AtoZ Markets – EURUSD started the day at 1.1275 area after a strong Bearish pressure took over the Bulls recently. As per the current scenario, EURUSD has been quite corrective and volatile but Bulls are still in charge. Certain engulfing bar retracement may take place, before EURUSD may continue its Bearish pressure in the process.
The United States Dollar is trying to gain momentum against the EURO after an extended period of sustainable defeat. As the deadly Coronavirus spread in several states of America, the U.S. economy is in a big threat. The Fed may cut the interest rate further to 0.0% – 0.25% in the upcoming meeting to support the U.S. economy.
The new President of the European Central Bank, Christine Lagarde is currently under extreme pressure after Italy’s economy is affected by Coronavirus issue. The Coronavirus spreading rapidly to Germany and France and other EU countries. The ECB may agree to cut interest rate to support the European economy in the coming weeks.
EURUSD Bearish Gap Covered – The Bulls may Retrace Higher
EURUSD has become volatile and indecisive after it failed to break below 1.1270 area, which is the last Bearish candle’s low. As per current price action, EURUSD may retrace higher before continuing the Bearish momentum.
Image: EURUSD 4 Hour Chart
According to the 4-hour chart, the price is currently climbing higher after rejecting the Bullish trend line. EURUSD rejected 1.1500 area and declined quite impulsively. As per the MACD histogram, Bullish hidden divergence has emerged while Bears were taking over the Bulls. As a result, upcoming Bullish pressure already got confluence from the market sentiment.
Moreover, the dynamic level of 20 EMA is supporting the price to move higher. The Kijun line and the Tenkan line area also working as a confluence of the dynamic levels of 20 EMA. It indicates that Bulls may continue to push higher for a while but residing below 1.1500 is an indication of Bearish pressure in the process.
Bears may Take Over the Bulls Temporarily
According to the Daily chart, EURUSD closed with a strong Bearish engulfing bar on the last trading day. The price was rejected from the 1.1500 key resistance area and push lower quite impulsively. The Bearish Engulfing Bar covered the recent Bullish Gap as well as the daily Bullish candle as well. The Bears are currently quite strong according to the current scenario. Though EURUSD may retrace 50% of the engulfing bar before continue to push lower towards 1.1175 area but the overall bias is still Bullish.
Image: EURUSD Daily Chart
On the other hand, the dynamic level of 20 EMA is residing below the 1.1175 support level. It may pull the price lower as per Mean Reversion and the Kijun line and the Tenkan line are also may work as the confluence for upcoming downward pressure along the way.
To conclude, EURUSD Bulls are recovering higher. Therefore, if price holds the momentum below 1.1500 area, the Bearish pressure may sustain towards 1.1175 or lower in the coming days.