EUR/USD has snapped a key confluence zone after rejecting the 78.6% Fibonacci retracement level near 1.1745. The latest daily candle shows a sharp bearish engulfing bar that sliced below both the ascending trendline and the 50-day SMA (1.1565), signaling a potential trend reversal or deeper correction.
This breakdown follows a multi-week uptrend, and momentum indicators are starting to confirm the bearish shift:
MACD is showing a bearish crossover below the signal line.
RSI has dropped below 50 (currently around 45.8), reflecting weakening bullish momentum.
The pair has now settled just above horizontal support near 1.1586. A decisive close below this level could open the door toward the next support zone around 1.1450–1.1500, where prior consolidation and the rising 200-day SMA (1.0929) may act as stronger demand.
Bulls will need to reclaim the 1.1650–1.1700 zone and see a bullish crossover on momentum indicators to regain control. Until then, the path of least resistance appears tilted to the downside, especially with trendline and Fib support now breached.
Bias: Bearish while below 1.1700. Watch for continuation lower if 1.1586 fails to hold.
-MW