EUR/USD long-term technical analysis

Europe’s slowdown in economic growth is major “No” for Euro, especially when the UK also near the Brexit deadline. Drama on Brexit continues unveiled but the market seems could breath calmer after UK Boris Johnson agreed to pursue Brexit with a deal.

On the U.S ground, the Fed showed dovish outlook and might be ready to settle for another rate-cut next year. The situation is mostly weak for the U.S dollar. But, the tension between U.S and China on the trade war caused fear in the global market and U.S dollar gaining this month.

EUR/USD next direction will depend on the trade war development and the Brexit situation.

Click here to see EUR/USD long-term analysis September 2019

New Month

Monthly chart

EUR/USD drifted further lower and almost reach the bottom purple area. The pair provide us with a bullish engulfing pattern in the previous month but no follow-through by the bull this month. We have a bearish correction and might continue lower in the coming month.

At the current time, no bullish confirmation yet and traders will wait for trigger for the next movement.

Weekly chart

EUR/USD escaped from the bearish channel, but the pair continue bearish below the weekly SMA 200. No change to the direction yet. We have a new channel formed on the weekly chart and it seems the bear still in control. Traders might want to continue holding short positions for now until the pair reach the purple area or breakout above the channel.

Daily chart

There is little hope EUR/USD could turn bullish as higher low and higher high printed on the chart. However, the pair still trades below the daily SMA 200 and might continue below it. If the pair form a lower low on the chart then we know the bullish movement will stop and bearish leg will start.

Trade plan

EUR/USD trapped in a bearish trend in the daily and weekly chart. There is no reason to take a long position based on the situation. However, on the monthly chart, we have a bullish engulfing pattern that could overturn the current bearish trend. Traders need to wait for the pattern confirmed to get into safer long positions.

If the pair continues lower then the purple area on the chart will serve as a support level.