EURUSD Falls Further on Upbeat US Consumer Confidence Data
The EURUSD continued its intraday slide as the US Consumer Confidence survey posted better-than-expected numbers, with the index coming in at 131.6 as against the expected number of 128.2. The previous result was reviewed upwards to match the consensus number of 128.2. With a deviation which exceeded expectations and made the news tradable, the EURUSD has extended its downside push to trade at 1.10052.
The Coronavirus outbreak continues to remain a market-moving metric and safe-haven currencies such as the US Dollar and the Yen continue to benefit from the situation.
The EURUSD continues its downside push after breaking the rising wedge pattern last week. The disappointing German IFO Business Climate report of yesterday set the tone for continued downside on the pair. The USD-positive outcome for the Consumer Confidence Index is expected to help consolidate the gains the US Dollar has made over the Euro in the last four trading days.
The nearest support target remains 1.09932. However, the sentiment for the pair is still bearish, and there is potential for a break of the 1.09932 support line. If this occurs with a 3% closing penetration to the downside on the weekly chart or a double successive penetration close below this price level on the daily chart, a move to 1.09412 cannot be ruled out. The 1.09412 price level would mark the completion of the measured move from the broken border of the rising wedge; equidistant to the base of the wedge pattern.
On the flip side, failure to extend the intraday dip below the nearest support could allow the pair to take a breather, which then provides for a possible retest of 1.10630. The long-term trend continues to remain bearish, which makes the pair attractive to sell on rallies.