A potentially bearish key outside reversal day for the EUR/USD on Tuesday has defined important resistance and levels that need to break to trigger the next moves in either direction.
The bearish reversal would be confirmed with a close tonight below Tuesday's low at 1.1359.
The key resistance levels at 1.1500/16 have been confirmed by Tuesday's price action: 1.1500 was the pullback high on November 7 and 1.1516 is the 50 percent retracement of the decline from 1.1815 to 1.1216.
On the downside, key support lies at last week's low of 1.1216 and 1.1186, the 61.8 Fibonacci level of the entire January 2017-February 2018 rise.
The euro move higher late last week has left technical signals mixed - the 5-day moving average has crossed above the 10- and 21-day averages, while slow stochastics have crossed lower.
This suggests a period of consolidation between 1.1200 and 1.1500, with a break of key levels mentioned above the trigger for the next move.
A weekly close below the 200-week moving average at 1.1313 would be the first sign that a downside break is imminent.