Fan Yang
All posts from Fan Yang
Fan Yang in Fan Yang,

EUR/USD - 1.10 is the Next Key Support

A combination of a strong USD this week, and a disappointing economic sentiment data out of Germany today is sending the EUR/USD lower.

German ZEW Economic Sentiment (May): 41.9
Forecast: 48.8
Previous: 53.3

A reading above 0.0 is still suggestive of optimism, but we can see that it has slid in May, and much more dramatically than the average forecasts projected. 

The EUR/USD already ended last week retreating from 1.1466. 

EUR/USD 4H Chart 5/19

(click to enlarge)

We can see the sharp decline from 1.1466. Price is approaching a previous support pivot at 1.1066, but with some additional volatility this week, the EUR/USD might clear this low and push towards 1.10, where the bearish attempt would be challenged by the 200-period SMA and a rising trendline from 1.0520. A break below 1.10 then opens up a bearish outlook that would have the 1.0520 in sight. But for now, let's respect the current decline but limit the bearish outlook to 1.10.