EUR/USD losing grounds
The European currency was underpinned as I have forecasted in my previous analysis as the catalyst came in from the FED meeting and rate decision. Rates were increased on Wednesday from 2% to 2.25% and the overall projection was for further hikes later this year and the hawkish sentiments from the FED gave a strong boost to the dollar across the board.
The figure wasn't that impressive on the daily chart and the price went back from circa 1.8086 resistance levels and turned South as the market digested the news. With that, the price returned again below 1.17498 and closed below it with a closing price at 1.17369. The daily candle closed as a Bearish engulfing one signalling that the movement has reached its peak and it is time to reverse.
As seen from yesterday the price has tanked hard under 1.17093/1.17000 and broke the wedge formation to the Bearish "cave". Stoch and CCI also provided the early signal (check previous) post, so congrats to everyone who sold after when the dust settled after the FED news. The price has a potential of reaching the level of 1.15282, but first, we will need to see a strong breach of 1.16000 and a close below that to assume that there may be further selling to which we can tap in. Reaching and breaching these levels if supported by strong fundamentals and sentiment for the USD a new downtrend will be established here. Going with the trend will be the best option here of course with appropriate stop losses.