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EURUSD makes another new 2021 low. A new leg down may be starting.

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The EURUSD pair falls to the lowest level since July 23, 2020.

The EURUSD moved to the lowest level since July 23, 2020. The low price is reached 1.1541. In the process, the price is moving away from the old floor from September and November 2020 between 1.16016 and 1.16116.  The next major target on the daily chart is the 50% midpoint of the move up from the March 2020 low to the January 2021 high. That midpoint level comes in at 1.14918.  

Drilling to the hourly chart  below, recall from Monday’s trade the price moved back above the 100 hour moving average and aforementioned swing area from the daily chart between 1.16016 and 1.16116. 

During trading yesterday, the price momentum higher could not be sustained and the price moved back below those levels technical levels only to rebound in the US session toward the high end of that swing area. The price at the US session high did take a quick peek above the 1.16116 level but quickly reversed. Sellers showed their hand.

In trading today, the 100 hour moving average started to become resistance in the Asian session, and the price moved sharply to the downside in the European session to the new 2021 low at 1.15284.

A new downside leg for the EURUSD may be starting. If so, look for the previous lows from September 30 and October 1 at 1.15619 to hold close resistance on a rebound today.  A move above, would not necessarily hurt the bearish bias, but it would weaken  some of the bearishness on the fresh break to the downside, and could lead to more corrective  covering as a result. Ultimately it would take a move back above the 100 hour moving average (blue line currently at 1.15928 and moving lower) to give the buyers more confidence that a low is in place (and then they would need to get above the 1.16116 as well). Absent that and the left right is still in the downward direction with more negative technicals.

EURUSD on the hourly chart 

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