EUR/USD: Three signs of a 1.12 retest

Hi traders, here we have the EUR/USD pair which faced some selling pressure this morning. Let's see what's next for the market.

TECHNICALS:
The lower 1.14xx levels look like an important upside barrier at the moment. This can also be seen on the 1-hour chart, where the RSI is forming a bearish divergence in the short-term.

The strong selling pressure building up suggests that a downside breakout below the rising trendline could see further weakness in the pair and a possible retest of the lower 1.12xx levels.

RISK SENTIMENT:
Most major stock indices are down for the day, and the S&P will possibly be no exception (check out my recent post on the S&P 500). This could add to more USD strength.

INTEREST RATES:
Interest rate differentials (chart below), based on the 2y German and US yields, continue to point lower for the pair. Another sign for further weakness in the pair.

snapshot
Beyond Technical AnalysisbuyEUREURUSDForexfxTechnical IndicatorsSELLsignalstradeideaTrend AnalysisUSD

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