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A Falling Wedge Pattern Forming Up on EURUSD, Gains Still Seems Capped

EURUSD : Daily Chart

EURUSD today is posting some gains today even after the downbeat series of euro zone data showing that the economy is still not recovering. On the daily chart, the pair seems like following a falling wedge pattern which gives a bullish signal but to me the gains still seems capped. We might see the pair rising until it find resistance from the falling resistance trend line of the wedge or from 1.2922. A surge above the falling resistance trend line will only confirm the revival otherwise the pair will continue to decline.

EURUSD : 4 Hour Chart

Let’s have a look at the 4 hour chart, where 50 day SMA seems like acting as an important resistance which the pair tried to break once but again fell down below it. So the pair will continue to decline on the 4 hour chart as well. The gains seems to be for short term and mainly because of the US dollar weakness. But US dollar is not going to be weak for long term and will definitely pressurize EUR to decline further down.

On the other hand there also seems a descending triangle trend according to which the pair should break down from the key support at 1.2831 fading away the falling wedge pattern