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Apr 30 - 06:55 PM

BofA: Chart: An Emerging Bear Flag Pattern on EUR/USD Daily Chart

By eFXdata  —  Apr 30 - 03:00 PM


Bank of America identifies a potential bear flag formation on the EUR/USD daily chart, suggesting a possible continuation of the downward trend. Key resistance levels and historical patterns support this bearish outlook.

Key Points:

  • Bear Flag Formation: Analysts at BofA have observed what appears to be a bear flag pattern forming on the daily chart of EUR/USD as of late April. This pattern is typically indicative of a continuation of a prior downtrend following a brief consolidative period.

  • Critical Levels to Watch: A break below the key support level of 1.0675 would confirm the bear flag pattern, potentially setting the stage for a move toward the year-to-date low at 1.0601, and possibly extending to the 2023 low of 1.0448.

  • Resistance Levels: The EUR/USD faces significant resistance from declining moving averages and trend lines that currently cap the spot rate at or below the 1.08-1.0840 range. These levels need to hold to maintain the bearish outlook.

  • Additional Chart Patterns: Supporting the bearish view, a diamond top pattern has also been confirmed on the weekly chart, which generally signals a reversal from previous uptrends. This pattern aligns with the potential for further declines.

  • Longer-Term Targets: Should the bear flag and other bearish patterns hold, the EUR/USD might target the 61.8% Fibonacci retracement level at 1.0201, provided weekly closes remain below medium-term trend line resistance at 1.0915.


The technical analysis by Bank of America suggests a cautious or bearish stance on EUR/USD in the near to medium term, given the formation of a bear flag and the presence of other bearish chart patterns.

BofA Global Research


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