The Euro sees worse Daily drop in 3 Months

The decline in the euro Forex market (EUR/USD) accelerated lower yesterday as it posted its worse daily loss in over three months. Looking at the below daily MT 4 chart, note that the euro has a top in place below 1.09 after a bearish dark cloud cover candlestick formed. It would appear that the longer term down trend in this euro Forex market is resuming.

Euro Technical Analysis

Using the above daily MT 4 chart, let’s discuss today’s daily technical analysis. There is near term support lining up at 1.0605. A daily close below this first downside barrier challenges the next layer of technical support lining up at 1.0495, which is the February 22 low.

The alternative technical analysis notes a former support now turned resistance layer lining up at 1.0720. A break above this first upside barrier challenges the next technical resistance level lining up at 1.0875. This is also a former support level at the trend line.

Trade Strategy

Let’s now discuss today’s daily trade strategy. I was hoping for this forex market to bounce back to 1.0810. I cancelled that order and set a short EUR sale at 1.0685. The initial target for this short sale is at 1.0605 with the initial stop loss placed at 1.0719. If I meet the first target, I shall book half the profits and trail the stop loss to breakeven.