FX.co ★ EUR/USD challenging confluence area

The currency pair is trading in the red at 1.0566. The bias is bearish as the Dollar Index is bullish. The DXY forced the greenback to dominate the currency market. The USD took the lead again after the US services and manufacturing sectors announced expansion in the last trading session.

Fundamentally, the Euro is bearish even if the German ifo Business Climate and M3 Money Supply came in better than expected. On the other hand, the US New Home Sales came in at 759K versus 678K expected.

Tomorrow, the ECB is expected to keep the Main Refinancing Rate at 4.50%. Still, the ECB Press Conference and the US Advance GDP should really shake the price.

EUR/USD Bearish Movement!

Technically, the price took out the warning line (wl1) and now it challenges the confluence area formed at the intersection between the uptrend line with the 1.0564 static support.

The bias remains bearish in the medium to the long term despite the last swing higher. Still, a downside continuation needs confirmation.

EUR/USD Outlook!

A valid breakdown through the confluence area activates a strong sell-off at least towards the weekly S1 (1.0530). This is seen as a selling opportunity.