The EURUSD rebounded on the back of the yield declines at the start of the US session, but has reversed to the downside after the pair tested the highs from yesterday and the 100 bar MA on the 4-hour chart at 1.10712. The US session high reached 1.1068 just 3 pips short of that MA level.
The move back to the downside has now seen the price extend back to the lows reached in the morning European and early US sessions. That low comes in at 1.1032. The low just reached the same level. The price is also below 38.2% of the August trading range at 1.10389.
This is the 2nd time below the 38.2%. That should give sellers comfort/confidence. A lower channel trend line cuts across near 1.10166 (and moving lower). The 50% of the August range is at 1.09889. The 200-hour MA on the 4-hour chart comes in at 1.09725 should selling really intensify. That would be another target going forward.
Conversely, if the break below the 38.2% fails, the battle is on between the 100 bar MA above at 1.10712 and the 38.2% retracement level.
This article was written by Greg Michalowski at www.forexlive.com.
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