EUR/USD Price Analysis: Fades bounce off short-term key support as 50-SMA prods bulls
- EUR/USD struggles to extend the previous day’s corrective bounce during the first downbeat week in three.
- Three-week-old descending support line repeatedly challenges bears even if the key SMAs probe upside momentum.
- Bearish MACD signals, one-month-old descending resistance line add to the upside filters.
EUR/USD stays defensive around 1.0610-15 as bulls and bears jostle near the end of a volatile week, eyeing the first weekly loss in three despite the previous day’s bounce off a 10-week low.
In doing so, the Euro pair struggles to extend the U-turn from a three-week-long support line, around 1.0515 by the press time, as the 50-bar Simple Moving Average (SMA) joins the bearish MACD signals to challenge the bulls.
With this, the major currency pair is all set to retest the aforementioned support line of near 1.0515. However, the 1.0600 threshold and multiple supports around the 1.0580-75 zone could test the EUR/USD bears.
In a case where the pair sellers break the previously stated key support of 1.0515, the 1.0500 round may act as a validation point for the south-run targeting the four-month-old horizontal support comprising the Year-To-Date low and November 2022 high surrounding 1.0485-80.
Alternatively, an upside break of the 50-SMA, around 1.0630 by the press time, may help the EUR/USD buyers to aim for the 200-SMA hurdle surrounding 1.0680.
However, a downward-sloping resistance line from mid-February, near 1.0755 by the press time, could challenge the bulls afterward.
To sum up, EUR/USD is likely to remain pressured even if the downside room appears limited.
EUR/USD: Four-hour chart
Trend: Further downside expected