EUR/USD treads water around 1.1300 heading into Tuesday’s European session, following the heaviest daily fall since December 17. In doing so, the major currency pair tracks steady Treasury yields while waiting for second-tier data from Germany and the US. Not only the pullback from the 50-DMA level surrounding 1.1370 but a downbeat break of the 21-DMA, at 1.1310 by the press time, also keep EUR/USD sellers hopeful to test an ascending support line from November 24, close to 1.1255 at the latest.

BULLISH AND BEARISH CONDITIONS/ POSSIBILITIES :

The weekly chart has made a significant retracement to test the vicinity of 50% mean reversion. This leaves the focus on the downside in accordance with the dominant bearish trend.Should the bulls break the resistance on the daily chart, then there will be prospects of a continuation to mitigate some of, if not all of, the imbalance of price as.

On the other hand, considering the bearish trend, a break of both horizontal and dynamic support would reveal the downside imbalance.

Although price has staged a short-covering bounce to 1.1309 due partly to cross-buying of euro vs yen n sterling, as said decline on Mon suggests recent corrective upmove fm Nov's fresh 16-month bottom at 1.1187 has possibly ended at Fri's 6-week peak at 1.1386, a daily close below last week's low at 1.1274 (Wed) would add credence to this view. Offers are tipped at 1.1305/10 n more abv with some stops touted abv 1.1335 while some bids are noted at 1.1280-75 withs stops below 1.1270.EUR/USD has been in a long-term downtrend since the middle of 2021. For the weeks ahead, there is a bias towards 1.10 and the following illustrates this in a top-down analysis.

EURUSD Might Not Entertain the Bulls Much !

Jan 10 2022