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Denis Sergienko • 2022-03-03

EURUSD is all set to test 1.1000 psychological magnet

EURUSD is all set to test 1.1000 psychological magnet

EURUSD remains on the back foot around a 21-month low, despite the recently sidelined performance. That said, the bearish MACD signals do support the latest break of a descending support line from late November, around 1.1080 at the latest, which in turn hints at the quote’s further weakness. However, the RSI line nears the oversold territory and hence indicates that a bounce a brewing around the next support. The same highlights the 1.1000 support confluence for the bears, including 13-day-old support and 61.8% Fibonacci Expansion (FE) of the pair’s moves between September 2021 and February 2021. In a case where EURUSD’s downside fails to take a halt near 1.1000, October 2019 low near 1.0880 will gain the market’s attention.

Meanwhile, the corrective pullback may aim for December 2021 low surrounding 1.1220 before directing short-term EURUSD buyers towards the mid-February 2022 bottom around 1.1280. However, a convergence of the 21 and 50-DMA close to 1.1320-25 will be a tough nut to crack for the bulls afterward. Should the quote manage to cross the 1.1325 hurdle, the odds of its rally towards a seven-week-old horizontal resistance zone near 1.1480-95 can’t be ruled out.

Other than the technical details, grim concerns surrounding Ukraine pedal the rush to risk-safety, favoring the US dollar. Adding to the greenback’s strength is the comparatively more hawkish tone of the latest Fedspeak than the rest of the global central banks.

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