EUR/USD came under broad bearish pressure as markets awaited the conclusion of Wednesday's Fed meeting, erasing overnight gains and bringing a major topping pattern closer to completion.
The euro retreated against most major currencies, especially the yen and pound, resulting in EUR/USD breaking below the 10-day moving average and moving closer to the neckline of a head-and-shoulders top.
The neckline currently sits at 1.1768 and appears set to break.
Falling daily and monthly RSIs imply bearish momentum.
The RSIs are nowhere near oversold, indicating a substantial move lower is possible.
Should the Fed provide no new bearish catalyst for the dollar, the U.S. currency could rally, potentially driving EUR/USD lower.
A break of the head-and-shoulders neckline would complete the topping pattern and indicate EUR/USD could fall towards 1.1520/30.
That zone is a measured move nearly equivalent to the move from EUR/USD's Sept.
1 peak of 1.2014 on EBS to the neckline.
The extension below the neckline might be a grind though.
Solid support sits around 1.1685/1.1710, consisting of the 55-DMA, daily cloud top, Aug.
12 daily low and August's monthly low.
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