Daily Forex Update: EUR/USD
By: Dima Chernovolov
EUR/USD continues to fall inside the well-formed 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 is the result of the slow Initial Trend (one bar), significant Uniformity and Clarity (both rated at the 8 bar level). EUR/USD is expected to fall further inside this chart pattern – in line with the earlier breakout of the strong support area shown below.
As can be seen from the daily EUR/USD chart below, the price recently broke through support area lying between the powerful support level 1.1670 (which reversed the price in August and at the start of October), 100-day moving average and the 50% Fibonacci correction of the upward price impulse from June. This price area is acting as resistance zone after it was broken. The proximity of this resistance zone adds to the probability EUR/USD will continue to decline inside this Falling Wedge.
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