EUR/USD Is Exposed to Risk of Further Decline, Dollar Project Gains

Key Take-Aways

  • If EUR/USD breaches the 0.9900 support, the decline could pick significant speed.
  • On the 4-hours chart, a significant negative trend line is developing with resistance close to 0.9990.
  • GBP/USD is still trading below the 1.1550 support in a negative area.
  • In August 2022, the Euro Zone Services PMI may be steady at 50.2.

Technical Analysis of EUR/USD

When compared to the US Dollar, the Euro began a significant drop from well above 1.0100. The EUR/USD pair moved into a bearish zone after settling below the parity line.

The pair is displaying bearish signals on the 4-hours chart below the 1.0000 level, the 100 simple moving average (red, 4-hours), and the 200 simple moving average.

The 0.9900 support region had a small upward correction over the past week. The bulls were successful in raising the pair over the resistance levels of 0.9980 and 0.9995. Even though the pair climbed above 1.0000, it maintained its distance from the 100 simple moving average.

Near 1.0079, a swing high was created, and the pair then started a new drop. The 1.0000 and 0.9950 support levels were broken during trading. On the same chart, a significant negative trend line is also developing, with resistance located close to 0.9980.

The current price of EUR/USD is close to the 0.9900 support level. The pair may move toward the 0.9850 support if the downside breaks below the 0.9900 support. Near the 0.9820 level is the next significant support. Any more losses might necessitate a move towards 0.9780.

The pair is encountering resistance near the 0.9980 level on the upswing. The area around 1.0000 represents the next significant resistance, and if overcome, the pair may move up around 1.0080.

Regarding GBP/USD, the pair developed a bearish trend below 1.1550 and is displaying bearish indicators below 1.1500.

Economic News To Trade Today

  • German services PMI for August 2022 is predicted to be 48.2, up from 48.2 in the previous month.
  • Forecast Euro Zone Services PMI for August 2022 is 50.2, down from the prior reading of 50.2.
  • August UK Services PMI  for August 2022 – Forecast 52.5, versus 52.5 previous.
Amogo Solomon is a Broker-Dealer/Market Research analyst and writer in ACT Brokers with a background in Computer Science, Data Analytics, and Forex Broker Dealing. He specializes in Forex Dealing, markets Analysis, Currency research, forex fundamental and technical analysis, and Monitoring of Forex trends, Stocks, Equities, Cryptos, and Commodities. He possesses strong technical and analytical skills and is well known for his entertaining and informative analysis of the global economy, fiat currency, commodities, Stocks, Indexes, Futures, and Options markets. He held a Bachelor's degree in Computer Science and Nanodegree in Programming for Data Science Enterprise.