1. Technical Analysis
• Bearish Structure Break
After a strong bullish impulse in March and early April, price formed a rising wedge pattern—typically a bearish continuation structure when it follows an uptrend. Price has now broken below the wedge support and is retesting the underside of the structure.
• Key Supply Zone (1.1377–1.1444)
Price failed to break through this resistance twice, forming a double top with strong wicks and rejection candles. That zone remains a key institutional supply area, reinforcing downside bias.
• Break and Retest Confirmation
The break of the ascending trendline and horizontal support near 1.1287 confirms a change in structure. Price is now retesting the area as resistance—textbook bearish price action.
• Target Zones
• TP1: 1.1204 – minor demand and previous support
• TP2: 1.1090 – high-probability demand zone and fib confluence
• TP3: 1.0938 – extended move to fill imbalance and hit key structure low
• Stop Loss
Place stop above 1.1377—the recent high and above wedge resistance—to maintain a good risk-to-reward ratio.
2. Fundamental Analysis
• ECB–Fed Divergence
Recent comments from the ECB suggest a potential rate cut in the near term as inflation cools across the Eurozone, while the Fed remains relatively hawkish due to persistent U.S. core inflation. This divergence supports USD strength.
• Weak Eurozone Data
Recent German and French PMI data came in under expectations, pointing to slowing growth. Meanwhile, the U.S. economy continues to show resilience—especially in labor and retail sales—boosting USD demand.
• Risk Sentiment
As global markets flirt with risk-off sentiment due to geopolitical tensions and slower growth forecasts, safe-haven demand increases—typically favoring the U.S. dollar over the euro.
Conclusion
EUR/USD is showing strong signs of a bearish reversal after rejecting a major supply zone and breaking below wedge and trendline support. With structure, momentum, and fundamentals aligned, a short setup targeting 1.1204 down to 1.0938 makes sense. Wait for continued rejection or bearish confirmation before entering.
• Bearish Structure Break
After a strong bullish impulse in March and early April, price formed a rising wedge pattern—typically a bearish continuation structure when it follows an uptrend. Price has now broken below the wedge support and is retesting the underside of the structure.
• Key Supply Zone (1.1377–1.1444)
Price failed to break through this resistance twice, forming a double top with strong wicks and rejection candles. That zone remains a key institutional supply area, reinforcing downside bias.
• Break and Retest Confirmation
The break of the ascending trendline and horizontal support near 1.1287 confirms a change in structure. Price is now retesting the area as resistance—textbook bearish price action.
• Target Zones
• TP1: 1.1204 – minor demand and previous support
• TP2: 1.1090 – high-probability demand zone and fib confluence
• TP3: 1.0938 – extended move to fill imbalance and hit key structure low
• Stop Loss
Place stop above 1.1377—the recent high and above wedge resistance—to maintain a good risk-to-reward ratio.
2. Fundamental Analysis
• ECB–Fed Divergence
Recent comments from the ECB suggest a potential rate cut in the near term as inflation cools across the Eurozone, while the Fed remains relatively hawkish due to persistent U.S. core inflation. This divergence supports USD strength.
• Weak Eurozone Data
Recent German and French PMI data came in under expectations, pointing to slowing growth. Meanwhile, the U.S. economy continues to show resilience—especially in labor and retail sales—boosting USD demand.
• Risk Sentiment
As global markets flirt with risk-off sentiment due to geopolitical tensions and slower growth forecasts, safe-haven demand increases—typically favoring the U.S. dollar over the euro.
Conclusion
EUR/USD is showing strong signs of a bearish reversal after rejecting a major supply zone and breaking below wedge and trendline support. With structure, momentum, and fundamentals aligned, a short setup targeting 1.1204 down to 1.0938 makes sense. Wait for continued rejection or bearish confirmation before entering.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.