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EUR/USD Begins Downside Correction — Support Levels in Focus

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Aayush Jindal

Key Highlights

  • EUR/USD started a downside correction from the 1.1820 resistance zone.
  • There is a declining channel forming with resistance at 1.1700 on the 4-hour chart.
  • GBP/USD also corrected gains and traded below the 1.3550 level.
  • Gold recovered above the $3,320 level and tested the $3,365 resistance.

EUR/USD Technical Analysis

The Euro started a downside correction from 1.1820 against the US Dollar. EUR/USD dipped below the 1.1780 and 1.1750 support levels.

Looking at the 4-hour chart, the pair traded below the 38.2% Fib retracement level of the upward move from the 1.1453 swing low to the 1.1829 high. There is also a declining channel forming with resistance at 1.1700.

The pair now tests the 100 simple moving average (red, 4-hour) and is well above the 200 simple moving average (green, 4-hour). On the downside, immediate support is near the 1.1640 level. It is close to the 50% Fib retracement level of the upward move from the 1.1453 swing low to the 1.1829 high.

The next key support sits near 1.1600. Any more losses could send the pair toward the 1.1550 support zone. On the upside, the pair could face resistance near the 1.1700 level.

The next key resistance sits near the 1.1740 level. A close above the 1.1740 level could set the pace for another increase. In the stated case, the pair could even clear the 1.1780 resistance. The next major stop for the bulls could be near the 1.1840 resistance.

Looking at GBP/USD, the pair started a short-term downside correction and might decline toward the 1.3400 level.

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