EUR/USD: Failure to cross 1.0820/1.0870 likely to lead to persistence in downtrend – SocGen

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EUR/USD has extended its phase of decline. Economists at Société Générale analyze the pair’s technical outlook.

Signals of reversal are not yet visible

EUR/USD has experienced a steady decline within a steep descending channel and has recently reached the lower band at 1.0630/1.0610 which is also the low of June. 

Daily MACD is within deep negative territory denoting an overstretched move. However, signals of reversal are not yet visible.

In case a short-term bounce takes shape, the 200-DMA near 1.0820/1.0870 is likely to be an important resistance zone. Failure to cross this MA is likely to lead to persistence in downtrend. Next potential supports are located at 1.0480 and projections of 1.0430/1.0400.