The fluctuation around the 200 day moving average ended yesterday. The underlying negative tone – highlighted by both the 13 day avg and the Keltner channel – translated into increasingly aggressive selling.
This took EUR/USD to the most bearish levels traded for 15 weeks and although Asia has seen a profit taking rally, the underlying tone of the market is clearly negative so an extension of the Asian bounce should be limited and temporary.
This will keep the focus on the downside with potential to 1.3588, 1.3562 or even 1.3530.
