Technical Update - EURUSD how low can it go? GBPUSD could turn bearish. EURGBP broken key support, looking lower Technical Update - EURUSD how low can it go? GBPUSD could turn bearish. EURGBP broken key support, looking lower Technical Update - EURUSD how low can it go? GBPUSD could turn bearish. EURGBP broken key support, looking lower

Technical Update - EURUSD how low can it go? GBPUSD could turn bearish. EURGBP broken key support, looking lower

Forex 3 minutes to read
KCL
Kim Cramer Larsson

Technical Analyst, Saxo Bank

  • EURUSD failed to stay above 1.09 before being hit by heavy selling. Could sell off down to 1.0725
  • GBPUSD failing to build on the bullish trend. Could reverse to downtrend. Key support at 1.2670
  • EURGBP closed below key strong support at 0.85. A bearish move to 0.84 is in the cards

EURUSD
turned around Friday, failing to build on the uptrend it had established.
The uptrend was fragile, however, and sellers took control Friday and have kept it this Monday morning, pushing the cross below the lower rising trendline and below 1.08. Currently, having taken back 50% of the bullish move since mid-April, EURUSD could drop further to the 0.618 retracement and support at around 1.0725.

However, EURUSD is below all daily moving averages, indicating the tide has turned and is now bearish.

RSI is still holding above the 40 threshold, but a close below will confirm a bearish trend that can take EURUSD down to the next support and 0.786 retracement at around 1.0665. To reverse this bearish scenario, a close above 1.0915 is required.

A daily close above 1.08 will most likely put the cross in a neutral stance – a wait and see for direction
Source all charts and data: Saxo Group
GBPUSD seems to be failing to build on the upside momentum after breaking above 1.28. Twice now, sellers have taken control at around 1.2818 and could maintain control down to test key support at around 1.2670.

A break below could lead to further selling pressure towards 1.26–1.2550, possibly even down to the 0.618 retracement at 1.2495. A break above 1.2820 will resume the uptrend to 1.29.

RSI is still showing positive sentiment, however, suggesting GBPUSD will trade higher. But if GBPUSD closes below 1.2670, RSI is likely to close below the 40 threshold, thus showing negative sentiment.
EURGBP closed Friday below key strong support at around 0.85. Following through today, it seems sellers have taken full control. 
0.85 was a massive support: The pair tested it several times over the past 8-10 trading days. From both the the weekly and daily chart, we can see how important that level has been.

Now, there is no strong support until around 0.84. To demolish the bearish trend, a daily close back above 0.85 is required. To reverse it, a close above 0.8540 is required
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