EUR/USD To Extend Declines In Absence Of Bullish Reversal Patterns

By DailyFx | Updated July 25, 2014 AAA

DailyFX.com -

Talking Points

  • EUR/USD Technical Strategy: Shorts Preferred
  • Absence of key reversal patterns casts doubt on a recovery
  • Extended decline likely to be met by buying support at 1.34

EUR/USD may be primed to continue its descent with a void of key reversal candlesticks on the daily. While a break of the critical 1.3500 handle was initially met with some hesitation from traders (denoted by a couple of Doji formations), a push to 1.3400 now appears likely. A daily close above the now-resistance level at 1.3500 would be required to invalidate a bearish technical bias.

EUR/USD: Targeting 1.3400 With Bullish Signals Lacking

EUR/USD To Extend Declines In Absence Of Bullish Reversal Patterns

Daily Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here

Drilling down to the four hour chart; a sea of Doji candlesticks near 1.3455 suggested significant hesitation from the Euro bears to push the single currency lower. However, similarly to the daily chart; key reversal patterns remain absent following the break, paving the way for a drop to 1.3400.

EUR/USD: Absence of Key Reversal Patterns Casts Doubt On A Recovery

EUR/USD To Extend Declines In Absence Of Bullish Reversal Patterns

4 Hour Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here

By David de Ferranti, Market Analyst, DailyFX

Follow David on Twitter: @Davidde

To receive David’s analysis directly via email, please sign up here.

Learn how to read candlesticks to help identify trading opportunities with the DailyFX Candlesticks Video Course.

You May Also Like

Related Forex Analysis
  1. EUR/USD risk returning to the upside - FXStreet
    Forex News

    EUR/USD risk returning to the upside - FXStreet

  2. EUR/USD 1.2600 Put in Place as Key Pivot
    Forex News

    EUR/USD 1.2600 Put in Place as Key Pivot

  3. EUR/USD back to 1.2470
    Forex News

    EUR/USD back to 1.2470

  4. Major’s in a technical snapshot - RBS
    Forex News

    Major’s in a technical snapshot - RBS

  5. EUR/USD rallies as USD weakens broadly
    Forex News

    EUR/USD rallies as USD weakens broadly

Trading Center