- EUR/USD pulls back from monthly top, struggles to extend biggest weekly gains since May.
- Bearish cross, spinning top need validation from MACD.
- 1.1920 becomes the key hurdle to the north, bears may eye for July low ahead of yearly bottom.
EUR/USD edges lower around 1.1870 amid a quiet start to the week’s Asian session trading on Monday. The major currency pair snapped a four-day uptrend on Friday, posting the bearish spinning top candlestick.
The candle formation also gains support from a bearish cross of the 200-day EMA over 50-day EMA, suggesting further weakness of the quote. However, MACD flashes bullish signals and hence the pair bears are waiting for a clear signal.
As 1.1830 offers immediate support to the quote, a downside break of which will direct EUR/USD towards the previous month’s low near 1.1750 and firm-up bearish bias.
Following that, the yearly low near 1.1700 and November 2020 bottom surrounding 1.1600 will be in focus.
Alternatively, a confluence of the stated EMA and 61.8% Fibonacci retracement of March-May upside near 1.1920 will shrug off the bearish signals and pushing the EUR/USD prices towards late June’s swing high surrounding 1.1975.
It should be noted, however, that a clear upside break of 1.1975 needs validation from March’s top and May’s low around 1.1990, as well as the 1.2000 psychological magnet to convince the pair buyers.
EUR/USD: Daily chart
Trend: Bearish
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