EUR/USD, US Manufacturing PMI weaker, usd stronger!
Bears keep the EUR/USD under control. Despite ‘US Manufacturing PMI’ weaker then expected, 52.9 vs previous 53.5, usd run against euro again. Last night the pair touch a low of 1.1159 and recover today to 1.1240high, the previous resistance from Friday. We can see at this chart, that euro can’t recover to 1.1260/80 and that means that strong seeling orders start from 1.1230/40 already. Let’s see what next and could the pair recover or it will continue to fall to the previous low!? As you can see at my analysis, 1.1160/80 is previous and first support.
As EUR/USD powers down towards 1.10971 being the low from 26th January 2015, the question is whether there will be a bounce and a double bottom formed. RSI (14 periods) on the daily chart is reading 30.8 which whist indicating being oversold, it is certainly not an extreme. If it does give, then the next level of support is really at 1.07611 which is the low from September 2003 when retail forex was in its absolute infancy. It is really one of those situations that could go either way though I would prefer to stick with the trend and not attempt to trade any potential bounce.
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I agree, like I alwasy said, trade what you see not what you think, but… I have doubts about furder decline.