- EUR/USD holds lower ground at the two-decade low, prints three-day downtrend.
- Short-term support line, 61.8% FE joins oversold RSI (14) to trigger corrective bounce.
- Recovery remains elusive below parity level, sellers could aim for the 2002 low.
EUR/USD licks its wounds near the lowest levels since October 2002, picking up bids to 0.9830 heading into Thursday‘s European session. In doing so, the major currency pair consolidates the biggest daily losses in a week, mainly inspired by the US Federal Reserve (Fed), as market players await a slew of other central bank announcements.
That said, 61.8% Fibonacci Expansion (FE) of the pair’s June-September moves joins a one-month-old descending trend line and the oversold RSI to challenge EUR/USD bears around 0.9830.
However, a convergence of the previous support line from September 06 and the 50-SMA, around the 1.0000 parity level, could keep challenging the EUR/USD pair’s recovery moves.
Also acting as the upside hurdle is the 200-SMA and a six-week-long falling trend line, respectively near 1.0045 and 1.0140.
It’s worth noting that the EUR/USD pair’s run-up beyond 1.0140 will need validation from the monthly high near 1.0200 to convince buyers.
Alternatively, a downside break of the 0.9830 support won’t hesitate to direct EUR/USD bears towards the year 2002 low near 0.9610.
EUR/USD: Four-hour chart
Trend: Further weakness expected