EUR/USD Uptrend Is in Danger, As It Falls Below MAs

EUR/USD has turned bearish today after failing at the 20 SMA on the H4 chart

Let's see if EUR/USD will turn bearish long term

[[EUR/USD]] has been quite bullish for several months, as the situation with the coronavirus pandemic was slightly better in Europe than in the US. Although, the decline picked up pace further in July, with EUR/USD surging from around 1.12 to above 1.19.

Buyers failed twice to break the resistance area above 1.19, but 1.17 turned into support for this pair, which has turned into the ultimate support for this pair. The bullish momentum continued this month as well and buyers pushed above the previous highs, reaching 1.1960s.

But the price reversed down yesterday, as the USD sprang back to life, although the 100 SMA held as support for the second time. The price bounced back up, but the 20 SMA (grey) turned into resistance for EUR/USD. It rejected the price and the decline picked up pace after the soft services and manufacturing reports from Europe.

Now the 100 SMA has been broken on the H4 chart, with EUR/USD heading for the support at 1.17. This sort of price action looks sort of bearish, meaning that buyers are giving up below 1.20, so I expect the long term downtrend to resume again soon in this pair. We might try to open a long term sell signal, but will see how buyers will react now. If they fail to make new highs soon, then we might short EUR/USD.

 

 

ABOUT THE AUTHOR See More
Skerdian Meta
Lead Analyst
Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.

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