EUR/USD has dropped as much as 1.1631 level today confirming strong sellers. USDX's rally after the US manufacturing and services data drives EUR/USD down. Still, we cannot exclude a minor rebound in the short term if the dollar index comes back to retest a broken dynamic resistance.
The US Unemployment Claims is expected to drop from 860K to 845K jobs in the previous week, while the New Home Sales could drop from 901K to 890K in August. Better than expected data could lift the dollar.
The breakdown through the 1.17 psychological level signaled a deeper drop. EUR/USD has taken out the S2 (1.1662) static support as well. The next downside target is represented by the upper median line (uml) of the descending pitchfork.
The pair could continue to move down between the upper median line (uml) and the warning line (wl1). Though, a valid breakdown below the upper median line (uml) could signal a sharp drop towards the 1.1495 static support.
EUR/USD Trading Tips & ConclusionThe last H4 bearish candle signals further drop towards the upper median line (uml) and towards the S3 (1.1587) level. We may have a great selling opportunity if the rate will come back higher to retest the 1.17 broken level. A retest followed by a strong drop suggests selling.
Also, a distribution, sideways movement below the S2 (1.1662) could bring a selling signal as well. Some temporary rebounds could help us to go short as well. The H&S pattern was activated below 1.1753, while the breakdown below the 1.17 level signals a down reversal, broader drop.