The EURUSD is trading to new session low of 1.0653. In the North American session, the price has moved below the late Asian low of 1.0664. The price is also cracked below a swing target at 1.0678 and 1.06611 (follow the red horizontal lines on the chart above at those levels).
Looking at the hourly chart the next major area comes between 1.0633 and 1.0641. Those were swing lows and highs back to late April and early May. Later on May 20, the price moved above that area and after retracing back toward it on May 25, found support buyers before moving to the recent cycle high at 1.07861 (on May 30).
Last week the price did dip below the level, but quickly rebounded after the price could not reach the 38.2% retracement 1.06189. Both the swing level and the 38.2% retracement are important targets to get to and through if the sellers are to take back more control. Failure to get below the 38.2% retracement is not saying much about the corrective move.
Having said that, the price action since May 20 is stuck in an up and down range. The 100 and 200 hour moving averages have caught up in that period. The price has traded above and below those moving averages indicative of a market that is trying to find the next major move.
However of significance in trading today is that the swing high in the London morning session did find sellers against the falling 100 hour moving average (currently at 1.07048). Bearish. In addition, yesterday's high price stalled within an upper extreme swing area between 1.0748 and 1.07637. Bearish
That price action gave the sellers to go ahead to push lower and indeed they have reached new session lows as result.
What now?
If the price can stay below 1.0661, that would be the best case scenario for the sellers in the short-term. Another risk level might be the low from May 31 at 1.0678 for sellers looking for more downside momentum. The moving averages may also be risk levels for traders anticipating a further break to the downside.
Alternatively, dip buyers could lean against the lower swing area. It has worked before. It could work again.
However a break below the swing area and the 38.2% retracement should increase the bearish bias and lead to further selling on the break..