FX.co ★ EUR/USD: deeper drop favored ahead of FOMC minutes

The EUR/USD pair crashed in the last hours and now is trading at 1.0753 at the time of writing. The bias remains bearish, so more declines are natural. You knew from my previous analysis that the Dollar Index is strongly bullish and it could hit new highs. DXY's rally forced the greenback to approach and reach new highs.

Fundamentally, the German Ifo Business Climate came in at 91.7 points versus 93.0 points estimated. Still, the currency pair should register sharp movements only after the FOMC Meeting Minutes. A dovish speech could weaken the greenback, while a hawkish report could boost the USD.

EUR/USD False Breakout!

Technically, the rate found temporary support on the median line (ml). It has rebounded but it has registered a false breakout with great separation above the 1.0797 static resistance signaling downside pressure.

Now, it challenges the median line (ml) and the 1.0748 downside obstacles again. The weekly S1 (1.0740) represents a downside obstacle as well.

EUR/USD Forecast!

A new lower low, a bearish closure below 1.0748 and under the S1 (1.0740) is seen as a new selling signal.