By: Dima Chernovolov
EUR/USD continues to fall inside the 4-hour Down Channel chart pattern which was identified earlier by Autochartist. Autochartist rates the quality of this Down Channel at the 4-bar level – which is the result of the slow Initial Trend (1 bar), below-average Uniformity (4 bars) and significant Clarity (8 bars). EUR/USD is expected to fall further inside this Down Channel – in line with the earlier breakout of the key support level shown below.
As can be seen from the daily EUR/USD, the price earlier broke the powerful support level 1.1114 (which has been repeatedly reversing the price form April). This price level is acting as strong resistance after it was broken. The proximity of this resistance level and the strength of the active daily downtrend increase the probability EUR/USD will continue to fall inside this Down Channel.