EUR/USD (a 4-hour chart)
The European currency rose at the beginning of the week. Earlier the euro was being sold off against the dollar amid the ECB members ’ “dovish statements”, their confidence about the Fed’s and the European regulator’s differently directed monetary policies as well as the Eurozone weak economic statistics that points out to the downward trend continuation.
The euro looked very bearish, breaking the support level of 1.2600 last week. The level breakdown has occurred amid the increased volume. Then the pair bounced upward from the support level of 1.2500.
The price is finding the first support at 1.2500, the next one is at 1.2400. The price is finding the first resistance at 1.2600, the next one is at 1.2670.
There is a confirmed and a strong sell signal. The price is under the Cloud and it is under the Chinkou Span. The Tenkan-sen shows a downward movement and the Kijun-sen shows a horizontal movement. The downward movement will be until the price is under the Cloud.
The MACD indicator is in a negative territory. The price is correcting.
We expect a flat. The downward bounce potential targets are 1.2500, 1.2400.