EURUSD’s rally was harshly rejected just below the 1.1700 level and near the 50-day simple moving average (SMA) on Friday, with the price crossing all the way down to test the 14-month low of 1.1528.
The short-term risk is looking neutral to bearish as the RSI is trying to regain strength after dipping below its 50 neutral mark and the MACD is set to cross back below its red signal line in the negative territory. A clear bearish cross between the red Tenkan-sen and Kijun-sen lines could further darken the short-term outlook in the coming sessions.
Technically, however, the bears may not take full control unless the floor between 1.1565 and 1.1528 cracks. This is where the restrictive 200-weekly SMA is currently flattening, therefore any decisive close lower could motivate fresh selling, with the price likely tumbling towards the key 2020 resistance zone of 1.1450. Breaching that base too, the next stop could be near 1.1365.
On the upside, the bulls could get congested around the 1.1600 level and the 20-day SMA. If not, all the attention will then shift back to the 50-day SMA and the crucial descending trendline seen around the 1.1700 number. The 23.6% Fibonacci retracement is also positioned in the same location. Hence, a violation at this point will be closely watched for an acceleration, likely towards the 1.1753 hurdle.
Summarizing, EURUSD has resumed a bearish bias in the short-term picture, but only a clear fracture of the 1.1565-1.1528 zone could activate new selling orders.