EUR/USD Seems to Be Resuming the Downtrend on the Double Top Pattern
[[EUR/USD]] has been bearish for more than a year but October was a pretty bullish day for this pair. In fact, it was the USD which turned bearish last month after the manufacturing report fell deeper into contraction and the FED remained more dovish than hawkish, after cutting interest rates for the third time in the last three meetings.
As a result, this pair climbed around 300 pips during the first half of the month. In the second half EUR/USD retraced lower, but it resumed the uptrend again in the last week of October. Although, buyers couldn’t take out the previous high at 1.1180.
This week EUR/USD reversed down, which means that a double top pattern has formed for this pair on the daily chart. yesterday, the US ISM non-manufacturing report came in strong than expected and it reversed the softening trend, which gave the USD a push higher and this pair slipped lower.
The bottom of the neckline at 1.1070 was broken, so EUR/USD is heading for the 50 SMA (yellow) now. If the double top pattern is to work out now, EUR/USD should head for 1.0970s, but one step at a time.
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