Technical Analysis

EUR/USD Price Analysis – July 04, 2023

By LonghornFX Technical Analysis
Jul 5, 20233 min

Daily Price Outlook

The EUR/USD pair remains in a neutral stance as it hovers around the 1.1011 level, while earlier on Wednesday in Europe, it faced downward pressure near the weekly low at 1.0880.

The lack of significant movement in the pair can be attributed to the cautious sentiment surrounding the release of the Federal Open Market Committee (FOMC) minutes for the June meeting and the Eurozone Producer Price Index (PPI) for May.

The sellers find support from the continued trading below the 50-day and 100-day Simple Moving Averages (SMA), along with bearish indications from the Moving Average Convergence Divergence (MACD) indicator.

Notably, the 50-day SMA is approaching a bearish cross and has crossed below the 100-day SMA, indicating the potential for further decline in the major currency pair.

The EUR/USD bears are eyeing the upward-sloping support line from May 31 near 1.0860, although the pair's decline may be limited unless it breaches the 1.0820 support level marked by the 200-day SMA.

However, short-term upside momentum is hindered by the convergence of the 50-day SMA and 100-day SMA, which currently align around 1.0910.

The Euro buyers will need to regain control and overcome the two-week-old downward-sloping resistance line, located around 1.0920, for a potential upward move.

As EUR/USD slides below 1.0900 ahead of the Eurozone PPI and FOMC minutes, concerns about a stronger US Dollar and weaker Euro prices contribute to the ongoing pressure.

It is important to monitor the market conditions and the risk-off sentiment as they may lead to further declines in the pair.

EUR/USD Price Chart – Source: Tradingview

EUR/USD - Technical analysis

The EUR/USD pair is currently exhibiting a subdued downtrend, gradually approaching the 1.0860 level. Notably, the price has recorded the third consecutive lower high, as depicted on the chart, indicating a potential triple top pattern.

To activate the negative impact of this pattern, a break below the neckline at 1.0840 is awaited, which could initiate a bearish move towards our projected targets starting at 1.0795 and extending to 1.0730.

Therefore, we maintain our suggestion of a bearish trend for the foreseeable future, supported by the downward pressure exerted by the EMA50 indicator.

It is important to note that a breach above 1.0940 would invalidate the aforementioned technical formation and potentially lead to a price recovery, with gains potentially reaching 1.1075 in the near term.

For today's trading, the expected range is anticipated to be between the support level of 1.0800 and the resistance level of 1.0940.



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