The EUR/USD dropped further today, resuming the yesterday’s impressive sell-off, could drop much deeper in the upcoming days because has ignored a dynamic support. The dollar is dragging the price down on the short term as the US dollar index has finally managed to jump much above the 99.12 static resistance.
I’ve said that the index will start a broader increase if will have enough energy to stabilize above the 99.12 resistance. The dollar has started to dominate the currency market since yesterday, was sent higher by the Marcron’s victory in France. Price goes down on the mixed Euro-zone and United States data, technically should drop further after a false breakout above a strong dynamic resistance.
The dollar has received support from the JOLTS Job Openings, which have increased from 5.68M to 5.74M in March, beating the 5.67M estimate, while the NFIB Small Business Index dropped from 104.7 to 104.5 points, has come in much better versus the 104.0 estimate. The USD has taken a hit from the Final Wholesale Inventories, which rose by 0.2%, even if the traders have expected to see a 0.1% drop, while the IBD/TIPP Economic Optimism dropped from 51.7 to 51.3 points, despite that the specialist have forecasted an increase to 52.3 points.
Price has dropped aggressively and has ignored the support from the lower median line (lml) of the minor ascending pitchfork, should drop further if will close below this line and somewhere below the 1.0910 level.
We could still have a Rising Wedge pattern after the false break above the upside line of the potential chart pattern, but we still have to wait till the pattern will be confirmed. Has signalled an exhaustion when has failed to stay above the 1.0949 static resistance.
The failure to approach the median line (ml) of the minor ascending pitchfork has signalled that a leg lower could take birth these days, the rate could come back to retest the lower median line (lml) of the minor ascending pitchfork before will drop further. We could have a selling opportunity if the rate will fail to make new high.