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Jun 25 - 05:55 AM

EUR/USD - COMMENT-EUR/USD Retrace Could Snowball

By Peter Stoneham  —  Jun 25 - 03:35 AM

The risk to long plays is increasing and EUR/USD losses could snowball if bulls re-evaluate and coronavirus fears escalate nL1N2E10KC.

A marked increase in EUR long bets gave warning at the start of the week, and with good euro zone data absorbed quickly, the rally to 1.1348 June 23 high, EBS data, looked fragile nL8N2E11QD.

Another warning to those long came from last week's failure to close above the Ichomoku cloud.
The price has climbed back above, but a long upper shadow on this week's candle does not bode well.

The retrace off the 1.1168 to 1.1348 June 19 to June 23 climb has matched the 76.4% Fibo, 1.1237, and a break should force a full retracement.

Double day lows at 1.1168, the main support point, and below here eyes more major retracement levels off the 1.0767 to 1.1422 May 7 to June 10 bull run.

The price is sticking close to the 21-DMA at 1.1247, but a close below would add to the bearish call.
A distant daily cloud twist, 1.0895-1.0913 July 1, adds to the risk and provides a target for the more ambitious bear play.







EUR/USD daily ichimoku chart: Click here

Source:
Refinitiv IFR Research/Market Commentary

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