FX.co ★ EUR/USD: more declines in cards, 1.0585 as key support

The EUR/USD pair is trading in the red at 1.0591 at the time of writing. The bias remains bearish, so a further drop is natural. The Dollar Index is strongly bullish, further growth should lift the greenback.

You knew from my previous analysis that the US Prelim GDP represents a high-impact event today. The indicator reported a 2.7% growth versus the 2.9% growth expected and compared to the 2.9% growth in the previous reporting period. The USD reiterated a little after the economic data but it's still bullish as the Unemployment Claims and Prelim GDP Price Index came in better than expected.

EUR/USD Down Channel Intact!

Technically, the EUR/USD pair continues to stay below the downtrend line. You knew from my previous analysis that as long as it stays below the downtrend line, it could approach and reach new lows.

It has retested the 1.0612 and the weekly S1 (1.0600) broken downside obstacles signaling a further drop. Still, today's low of 1.0585 represents a downside obstacle.

EUR/USD Outlook!

Dropping and closing below 1.0585 activates a larger drop and is seen as a new selling opportunity. The downside scenario could be invalidated only by a valid breakout through the downtrend line.

The channel's downside line and the S2 (1.0510) represent downside targets.