- The bears will note the daily resistance in the 50% and 38.2% ratios.
- Bears seeking a downside extension in the coming days, breaking the prior lows of 1.1280.
As per the prior session's analysis, ''EUR/USD Price Analysis: Consolidation plays out near critical resistance'', whereby the price had been attempting to rise in Tokyo but lacked conviction in a sleepy Asian session, the turmoil in financial markets pertaining to the Russian risk weighed eventually. The has been euro and capped it in its daily advance, as illustrated below:
EUR/USD prior analysis
In the prior analysis, it was suggested that those on the lookout for signs of exhaustion in the price action would note the double top formed on the hourly chart:
EUR/USD daily chart
The price was testing daily resistance and if this holds, the focus should have been on the downside.
EUR/USD live market
As illustrated, the signs of exhumation in the price action are being seen following the price drop and subsequent lower highs in the phase of recovery of that price drop.
At this juncture, failures to break above the trendline resistance should equate to selling pressure to force the bulls back below the current horizontal support structure between 1.1340/60. In doing so, the bears will be back in control and for the foreseeable days ahead:
EUR/USD daily chart
The bears will note the resistance in the 50% and 38.2% ratios that could lead to a downside extension in the coming days, breaking the prior lows of 1.1280.