Daily Forex Update: EUR/USD

By: Dima Chernovolov

EUR/USD continues to fall inside the clear Falling Wedge chart pattern which was previously identified by Autochartist on the 30-minute charts. Autochartist rates the quality of this Falling Wedge at the 5-bar level – which reflects the slow Initial Trend and Uniformity (rated at the 3 and 4 bar levels respectively) and maximum Clarity (10 bars). EUR/USD is expected to fall further inside this Falling Wedge – in line with the earlier breakout of the combined support area highlighted below.

As can be seen from the daily EUR/USD chart below, the price earlier broke the combined support area lying at the intersection of the support trendlines of the two daily up channels from August and May, key support level 1.1870, 30-day moving average and the 50% Fibonacci correction of the upward impulse from August. This price area is acting as resistance zone after it was broken. The proximity of this resistance zone increases the probability EUR/USD will continue to fall inside this Falling Wedge.

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