USD/EUR Analysis / RSI DivergenceHello everyone, as we all know the market action discounts everything :)
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The USD/EUR pair was down on Friday morning in Asia, and dropped almost 0.96 %, and reached 0.8847, and an RSI Bearish Divergence has been found between the chart and the market.
The USD/EUR was trading in an uptrend channel and today was the breakout down which got a lot of investors worried about how safe is the dollar right now.
But losses were minimized as growing concerns about a newly discovered COVID-19 variant in South Africa.
Possible Scenario for the market :
The market has started dropping rapidly today and brokeout the uptrend channel, looking at the chart we can tell that the Bears are holding control right now which might cause the dollar to even fall even more.
the market is trending near the first support level at 0.8848 where we might see a rebound but so far none of the indicators are showing any Bullish movement,
the drop will probably continue to reach the second resistance level located at 0.8788 or even the 0.8720 level in the next period of time.
Technical Analysis Show :
1) The market dropped below the 5 10 20 MA and EMA indicating a Bearish trend for now, but still above the 50 100 and 200 MA & EMA.
2) The RSI is at 35.90 showing great weakness in the market with a bearish divergence found between the indicator and the market.
3) the MACD line is nearing the 0 line changing from a Bullish to a Bearish market with a Bearish crossover between the MACD line and the Signal line.
Support & Resistance points :
support Resistance
1) 0.8843 1) 0.8897
2) 0.8821 2) 0.8929
3) 0.8789 3) 0.8951
Fundamental point of view :
In Europe, a rising number of COVID-19 cases prompted Germany to consider following neighbor Austria’s lead and re-impose a lockdown.
If the COVID-19 situation worsens, then USD/EUR could go down further, but otherwise, the monetary policy divergence is definitely going to be weighing on the EUR in the medium term.
Investors are worried about the state of the dollar and looking forward to other safe-haven assets like Gold or Crypto.
This is my personal opinion done with technical analysis of the market price and research online from Fundamental Analysts and News for The Fundamental point of view, not financial advice.
If you have any questions please ask and have a great day !!
Thank you for reading.
