EURUSD – post-Fed bulls lost traction after upbeat US data; near-term focus turns lower
The Euro was sharply lower in the US session as the greenback received fresh boost from upbeat US retail sales which rose by 0.8% in November, strongly beating forecast for 0.3% increase.
US weekly jobless claims also surprised by falling to 225K vs forecasted rise to 239K, adding to fresh dollar’s strength.
Fresh weakness commenced after extension of post-Fed rally stalled on approach to pivotal barrier at 1.1867 (Fibo 61.8% of 1.1961/1.1717 downleg) and accelerated after better than expected US data.
The latest move is generating negative signal after repeated failure to close above daily cloud top and subsequent weakness forming the right shoulder of H&S pattern on daily chart.
The H&S neckline lies at 1.1715 and break lower is needed to complete the pattern and signal further downside.
Daily studies are gaining negative tone as RSI turned south and probes below its 7-day MA and 14-day momentum is deeply in the negative territory.
Near-term bears are taking a breather above daily Kijun-sen (1.1773) where temporary footstep was found.
Prevailing bearish near-term tone could be expected while the price stays below 1.1800 (converging 10/100SMA’s in attempt to form bear-cross.
Daily cloud top (1.1823) remains a key barrier and sustained break higher is needed to revive bulls.
Res: 1.1800; 1.1823; 1.1867; 1.1878
Sup: 1.1773; 1.1759; 1.1715; 1.1709