Thursday’s Eurodollar session closed in a form of a definitely bearish pin bar under April’s 1.0735 high. The candle may be an impetus for stronger declines in absence of a clearer direction on the most liquid currency pair during the current month.
As you can see on the chart below, this level also played an important role in March, supporting the pair in its second half. By combining the trend line with higher lows from this year’s minima, we receive an area of closed formation from which sooner or later the EUR/USD will have to knock out. Bears analysing medium-term trends will obviously count on striking the bottom.
Turning to W1 graph and stretching the Fibonacci retracement grid on last year’s depreciation by more than 1000 pips, we see in addition that the resistance zone strengthens 38.2% of the measurement, which may be another argument that confirms the mentioned level technically.
