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Euro Currency continues to Sell Off against the Dollar

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Looking at the euro currency (EUR) on the above daily EUR/USD MT 4 chart, the world’s most liquid currency exchange rate is looking to extend its selloff as we head into the weekend.

This key Forex market is now trading well below the key technical upside barrier in ply at 1.18 which was challenged a couple times this week and held.

Firstly, European Central Bank (ECB) President Christine Lagarde says that the central bank’s tool chest of monetary policy tools is now on standby as coronavirus (Covid-19) cases spike across the Eurozone.

As far as economic data is concerned, the European Union will publish their final monthly consumer price index (CPI) and monthly trade balance data.

The world’s largest economy will publish their monthly core and headline retail sales data. The University of Michigan will publish monthly preliminary consumer sentiment and their inflation expectations gauge. The United States is also releasing monthly business inventory data. Canada is releasing their monthly manufacturing sales data.

Daily Euro Currency Technical Analysis (EUR/USD)

Looking at the above EUR/USD price action chart, the 14 da MACD histogram, which is used to gauge the strength of trend, is below zero which is in bearish territory. The 14 day relative strength index (RSI) is also below the mid-line which is signaling the euro currency is starting a bearish price action trend.

With that said, the euro currency is trading near 1.17. This is 130 pips below last Friday’s high price point at 1.1830. The first downside barrier lines up at 1.1680 with 1.1649 being the next layer of technical support. Below that level, the downside barrier lining up at 1.1610/09 then comes into play.

On the upside, this key Forex market needs to break above 1.1830 in order for a price trend change and the bulls to reenter the market. He first upside barrier is in play at 1.1748 with the next layer of technical resistance comes into play at 1.1787.

About David Frank

David has his MA and PhD in Economics. He is a technical analyst who has been trading in the Forex world for over a decade. As an analyst and trader, David believes in the big picture by blending together technical analysis with the fundamentals behind the scenes in the Forex and Bond markets. David’s trading strategy is unique. He blends an understanding of fundamental and macroeconomics with technical analysis to offer a unique view into Forex. He applies several strategies including carry long positions, to take advantage of high yields in non-volatile markets, as well as using quicker, chart related analysis for day trading.

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