EUR/USD falls below the near-term upwards trendline
The inability to break above the 200-hour MA (blue line) and offers around the 1.1450 level has resulted in a move lower in EUR/USD and the pair is now trading near session lows close to the 1.1400 handle. The move lower in the last hour also sees price break below the near-term upwards trendline formed from last week.
A breach of the 1.1400 level will then see support come in around the 100-hour MA (red line) @ 1.1376 next. That will be a key test for buyers in the near-term should we get there. Move below the 100-hour MA and the near-term bias turns bearish once again.
Shorting EUR/USD has been a favourable trade for most of this month but currently price is trading between the two hourly moving averages making it difficult to build a strong conviction for the next near-term move. Dollar buying has been a crowded trade and as mentioned since last week it is due for some retracement but as long as the underlying momentum remains, it's difficult to argue against playing the pair differently.
However, charts don't lie either so even if the dollar is bound for only a retracement the near-term bias in the trade matters too. But for now, it doesn't look like buyers have enough fuel in them to make a further break to the upside.
It's been a rather tepid start to the day and I expect things to continue playing out this way until the session ends as the obvious macro themes at play are taking a bit of a breather to start the week: Turkey, Italy, dollar buying/selling.
