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Denis Sergienko • 2022-05-17

EURUSD bears dominate ahead of EU GDP, US Retail Sales

EURUSD bears dominate ahead of EU GDP, US Retail Sales

EURUSD portrays a bearish consolidation inside a seven-week-old descending trend channel ahead of the key Eurozone GDP for Q1 2022, the US Retail Sales for April and a speech from Fed Chairman Jerome Powell. Although oversold RSI conditions challenge the pair’s further downside, a convergence of the stated channel’s resistance line and the 10-SMA, around 1.0500, appears a tough nut to crack for the buyers. Even if the quote rises past 1.0500, the monthly high surrounding 1.0640 and March’s low of 1.0805 will challenge the upside momentum before welcoming the buyers.

On the contrary, lows marked since 2017, around 1.0350-40, restrict the short-term downside of the EURUSD. Following that, a downward trajectory towards the 1.0300 threshold becomes imminent. However, a convergence of the aforementioned channel’s lower line and downward sloping trend line from late January, close to 1.0220-10, could gain the market’s attention before the 1.0200 round figure. It’s worth noting that the pair’s south-run past 1.0200 seems a slow grind towards the 1.0000 psychological magnet.

Overall, the EURUSD pair’s downside has recently stalled but the trend remains bearish.

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