EUR/USD Technical Analysis – January 26 2015
ForexMarketz
January 26, 2015
Technical Analysis
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The EUR/USD pair broke down during the session on Friday, as the Euro continues to struggle overall. That being said, we did bounce significantly towards the end of the day which ended up forming a candle that looks somewhat supportive. I don’t think we are actually at real support yet, I believe that this had more to do with profit taking than anything else. However, I do recognize that a bounce is very likely. After all, this pair is oversold by just about any metric you measure it by.
Oh given wrong, I still believe that we are heading down to the 1.10 level, but we may need to bounce enough to test the 1.15 level for resistance. There are plenty of reasons the think of this pair will continue to go lower, but at the 1.10, I see massive amounts of support on longer-term charts. With that, it will be a significant fight down in that general vicinity. However, I am not willing to buy this pair until I get a long-term buy signal, or a break above the 1.20 handle, something that looks very unlikely at this point in time.
The question then becomes, how much longer can this downtrend run? If we get below the 1.10 level, at that point in time, you have to seriously start thinking about parity between the Euro and the US dollar, which is something that was unimaginable just six months ago. That being the case, I am starting to wonder whether or not this rally isn’t getting a little long in the tooth at this point in time? We will see what happens, but I do know that historically the Euro seems to have nine lives.