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Denis Sergienko • 2020-07-16

Technical Analysis: EURUSD justifies Wednesday's "shooting star" ahead of the ECB

Technical Analysis: EURUSD justifies Wednesday's

Having flashed a bearish candlestick formation the previous day, EURUSD drops below 1.1400 ahead of the key European Central Bank (ECB) monetary policy meeting. With the overbought RSI conditions offering extra points to the sellers, the pair's drop to the June 23 high near 1.1350 becomes more likely. Though, an upward sloping trend line from May 14, currently around 1.1310, seems to defend the bulls. In a case of a huge disappointment from the ECB, which is less likely, the quote will slip below 1.1310 support line to attack 1.1165/60 support confluence including 50-day SMA and 61.8% Fibonacci retracement of March month's fall.

If the regional central bank offers any positive surprises, other than suggesting the stimulus that has already been capitalized, the EURUSD prices may regain the 1.1400 mark. Though, bears aren't expected to step back unless the quote crosses Wednesday's top of 1.1451. Following that, the pair could quickly overcome March month's peak near 1.1500.

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