Technical Update - EURUSD about to break parity. Where to next ?
Kim Cramer Larsson
Technical Analyst, Saxo Bank
EURUSD is about to break below parity. 1.00. It has been in the cards for quite some time but what is next. I wrote about it in May https://www.home.saxo/content/articles/forex/taeurusd-05072022 but time to refresh.
We must look back several decades to find support levels. 0.96 is next support but EURUSD dropping into the Consolidation area from 2000-2002 between 0.96 and 0.82 is not unlikely.
0.90 is a key level. Back in May 2002 that was the breakout level where EURUSD broke bullish out of its Symmetrical triangle pattern reversing the long down trend going back to the early 1990’s.
RSI still has a bit of way to drop before it reaches same value as in 2015 and 2000 where market turned around. However, just because RSI will hit historic low values around 20 it is not a guarantee of a market bottom. As we saw back in 2015 when RSI hit 20 it was not the market bottom. It was in 2016 in other words a rebound is probable but it is quite likely it will not be the bottom in EURUSD.
Latest Market Insights
Quarterly Outlook Q3 2022: The Runaway Train
- Central banks' attempts to kill inflation is a paradigm shift, which could end in a deep recession.
Tangible assets and profitable growth are the winnersWith US equities officially in a bear market, the big question is where and when is the bottom in the current drawdown?
Understanding the lack of investment appetite among oil majorsThe everything rally seen in recent quarters has become more uneven, as its strength is driven by commodities in short supply.
The pressure is on as the wind leaves the sailsWith cryptocurrencies in sharp decline, are we entering a crypto winter or is the bear market a healthy clean-up of the crypto space?
Why the Fed can never catch up and what turns the US dollar lower?Many other central banks are set to eventually outpace the Fed in hiking rates, taking their real interest rates to levels higher than the Fed will achieve.
Bank of Japan: Swimming against the tideThe Japanese economy has gone from the age of deflation to rapidly rising prices in no time, leaving the Bank of Japan in a pickle.
Green transformation detour and bear market hibernationWith the impending risk of global econonomic derailment, we share the five things investors need to consider in this new half year.
Crisis redux for the eurozone?Whether there's going to be a recession in Europe or not, the path towards a stable economy will be agonizing.
Technical Outlook: Gold, Oil and a remarkable multi-decade perspective on EquitiesThe Nasdaq bubble pattern, USDJPY resistance, crude oil uptrend losing steam and the technical outlook for USD.
China: the train of new development paradigm left the station two years agoChina is transiting to a new development paradigm, as they are hit by deteriorating terms of trade, a slower global economy and an uncertain future while continuing attempts to contain the pandemic.