Technical Market Overview:
After the EUR/USD pair has made a local high at the level of 1.1239, the bears took the control of the market and managed to push the prices below the technical support at the level of 1.1174. The short-term trendline resistance has been tested from below around the level of 1.1210 and violated, but the rally has been terminated, despite the strong and positive momentum. The market is coming off the overbought conditions due to a clear negative divergence between the price of a momentum indicator. After the technical support at the level of 1.1174 has been broken, the next technical resistance is located at the level of 1.1242 and 1.1250. Although the higher timeframes trend remains bearish, the global investors must take into account, that the EUR/USD might be finally breaking up from the multi-month Ending Diagonal pattern.
Weekly Pivot Points:
WR3 - 1.1349
WR2 - 1.1265
WR1 - 1.1228
Weekly Pivot - 1.1151
WS1 - 1.1114
WS2 - 1.1029
WS3 - 1.0994
Trading Recommendations:
The best strategy for current market conditions is to trade with the larger timeframe trend, which is down. All upward moves will be treated as local corrections in the downtrend. The downtrend is valid as long as it is terminated or the level of 1.1445 clearly violated. There is an Ending Diagonal price pattern visible on the larget timeframes that indicate a possible downtrend termination soon. The key short-term levels are technical support at the level of 1.1040 and the technical resistance at the level of 1.1267.
