The EUR/USD currency pair is still oscillating around the level of 1.1600 with no significant dynamics for the second day in a row. This stifling quiet comes on the heels of a distinct absence of major known drivers that would steer the pair one way or another. The EUR/USD pair is now trading below the 20 and 100 Simple Moving Averages (SMAs). As displayed above, this condition indicates a bearish reversal and even the potential for a deeper move downward.
The pair has been locked in an extremely narrow range, providing no directional guidance from technical signals. The 20 SMA is performing the role of dynamic resistance and is located at around 1.1610. At the same time, both the 100 and the 200 SMAs are moving marginally lower. This positioning means that bullish moves might face strong resistance right away. The current convergence of the 20 and 100 SMAs around the 1.1650 level forms a key resistance wall.
Analysts will point the finger to the lack of momentum in the EUR/USD pair as signifying its bearish disposition. The Momentum indicator is moving up below the 100 level, indicating lack of strong buying pressure by buyers. Additionally, the Relative Strength Index (RSI) stands directionless at approximately 43, indicating that neither buyers nor sellers have taken control.
EUR/USD Technical Support levels are currently set at 1.1590, 1.1540 and 1.1510. If these thresholds can’t hold, the pair might continue its descent even deeper. With lack of strong buying appetite there is an increasing risk that the falling trend could continue during the next sessions.
Official resistance levels are currently at 1.1650, 1.1690, and 1.1740. Equity market participants are extremely focused on these levels to see if they can be reversed or consolidated. Given today’s technical landscape, a breakthrough beyond these levels is improbable. As a practical matter, a very large change in market sentiment would be required for either of these changes to happen.