Euro Price Forecast: EUR/USD Plummets Towards Support at 2021 Low

• Euro updated technical trade levels & sentiment – Weekly Chart

• EUR/USD sell-off approaching key support hurdles near the 2021 yearly lows

• Weekly support 1.1695, 1.1616 critical; Resistance around 1.1880s / bearish invalidation 1.2005

Euro is poised for a second weekly decline (eight consecutive days) against the US Dollar with EUR/USD down more than 0.3% to trade at 1.1719 on Tuesday in New York. The decline takes price towards the major support at the yearly lows and were on the lookout for possible inflection in the days ahead with the bears at risk heading into the 1.17handle / US inflation data tomorrow. These are the updated targets and invalidation levels that matter on the EUR/USD weekly price chart. Review my latest Weekly Strategy Webinar for an in-depth breakdown of this Euro technical setup and more.

EURO PRICE CHART – EUR/USD WEEKLY

Notes: In last months Euro Weekly Price Outlookwe noted that, “A break below yearly uptrend support threatens a larger Euro breakdown- that said, the decline may be vulnerable near-term as price approaches the yearly close-lows.” EUR/USD held above the low-week close at 1.1760 for four consecutive weeks before breaking lower on Friday. The decline takes Euro into the objective yearly range lows / 38.2% % Fibonacci retracement of the 2020 advance at 1.1695- note that the 25% parallel of the descending pitchfork also converges on this threshold and further highlights the technical significance of this lateral support zone- looking for inflection off this zone.

Initial resistance rests with the median-line, currently near 1.1880s backed by the 100-day moving average at 1.1955. Broader bearish invalidation now lowered to 1.2005. A break lower from here exposes an even more significant confluent support zone at the 2016 high / 100% extension at 1.1616/21- look for a larger reaction there IF reached.

Bottom line: The Euro sell-off is now approaching key support into the yearly lows at 1.1695 and we‘re looking for guidance off this mark. From a trading standpoint, look to reduce short-exposure / lower protective stops on a stretch into this support zone – rallies should be capped by the August open at 1.1867 IF price is heading lower. I’ll publish an updated Euro Price Outlook once we get further clarity on the EUR/USD near-term technical trade levels.