Weakness in emerging market currencies is helping to fuel contagion fears, driving investors into the U.S. Dollar, while putting pressure on the Euro.
At 1346 GMT, the EUR/USD is trading 1.1557, down 0.0042 or -0.36%.
Daily Technical Analysis
The main trend is up according to the daily swing chart. However, momentum is trending lower. A trade through 1.1734 will change the main trend to up.
The minor trend is down. This is helping to drive the downside momentum. A trade through 1.1530 will reaffirm the downtrend.
The minor range is 1.1530 to 1.1734. The EUR/USD is currently trading on the weak side of its 50% level or pivot at 1.1632, helping to contribute to the downside bias. This level is new resistance.
The main range is 1.1301 to 1.1734. Its retracement zone at 1.1518 to 1.1466 is the primary downside target. Since the main trend is up, buyers may re-emerge on the first test of this area.
Daily Technical Forecast
Based on the current price at 1.1557 and the earlier price action, the direction of the EUR/USD the rest of the session is likely to be determined by trader reaction to the uptrending Gann angle at 1.1581.
A sustained move over 1.1581 will indicate the presence of buyers. This could lead to a retest of the resistance cluster at 1.1632 to 1.1634. This area provided resistance earlier in the session. Overtaking 1.1634 could trigger a breakout to the upside.
A sustained move under 1.1581 will signal the presence of sellers. The first target is a downtrending Gann angle at 1.1534. Crossing to the weak side of this angle will indicate the selling is getting stronger. This could lead to a quick test of the 50% level at 1.1518.
Taking out 1.1518 could trigger an acceleration to the downside with the Fibonacci level at 1.1466 the next likely target.