EURUSD Selling Rally awaits a break below 1.11 with a daily close. Despite the recent volatility, break below 1.11 may lead the price to 1.10 again in the coming days. Check Today’s EURUSD Technical Analysis for more levels and insights on the pair.
January 14, 2020 | AtoZMarkets.com – EURUSD recently bounced off the 1.11 support area with a daily close. Earlier, the price managed to create a new high above 1.1200 area but failed to sustain the momentum. Despite bouncing off the 1.11 area, a daily close below will lead to further bearish pressure in the coming days.
Eurozone growth has managed to stabilize after the recent fall. In September 2019, ECB approved a range of support to eliminate the fear of recession. As per ECB board member Mersch, “The economy is certainly giving good signs of stabilization… and the same goes a little bit for inflation,”. The ECB policy is expected to be unchanged on January 23, 2020 as changes in the policy might risk the economic stability.
On the other hand, FED rate expected to range between 1.50% to 1.75% and the U.S. central bank is very positive keeping it that way. NFP having significant decrease may have weakened the USD in the process but upcoming economic reports may show different results.
EURUSD Technical Analysis – January 14, 2020
The price has been quite impulsive with the recent bullish pressure while bouncing off the 1.11 support area with a daily close. After the false breakout above 1.12 area, the price is currently residing in the middle of the range. The price residing at the edge of 1.1135 area is also being held by the dynamic level of 20 EMA. As the bearish pressure sustains, EURUSD selling rally expected.
image: EURUSD Daily Chart
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Despite the recent impulsive bullish momentum, the bears are still quite strong to hold the price lower in the process. The volatility in the pair still persist but residing below 1.1200 area with a daily close indicates upcoming bearish momentum.
The price managed to push lower rejecting 1.1175 area earlier for several times. The impulsive pressure off the level clarifies the intention of the bears from the price area. The dynamic level of 20 EMA is currently flat which indicates further correction is in the making.
EURUSD ranges between 1.1100 to 1.1200 area until a break
image: EURUSD H1 Chart
As per H1 chart, the price is currently consolidating at the edge of 1.1135. The price developed Bearish Regular Divergence which pushing higher in the process. If the price manage to break below 1.1130 level with an hourly close then further downward pressure towards 1.1100 is expected. On the contrary, a break above 1.1150 will lead the price higher and deviate the strong bearish bias.
So, the price is expected to consolidate and range between 1.1100 to 1.1200 area until a break with a daily close is observed. Hence, as per recent bearish price action, there are higher probability of pushing lower towards 1.11 and below.
In Conclusion, EURUSD expected to push lower towards 1.11 support area. A break below the area with a daily close may start the selling rally towards 1.10 in the coming days.