2020 is so far a nightmare for the EURUSD. The pair is extending the losses and today, we are on the lowest levels since May 2017. Fundamentally, that is a combination of dovish ECB and fears about the slowdown in Eurozone, Germany in particular. Technically, that is a result of a bearish breakout from the beautiful wedge pattern, which the EURUSD was creating at the turn of the year. As they say, trend is your friends, so further decline seems more probable at the moment.
GBPUSD is also suffering, although not that seriously as the European peer. Here, we are still inside of the flag pattern and the price being above the lower line of this pattern is actually the last hope for the buyers. Breakout looks imminent though and has chances to bring us a legitimate long-term sell signal.
What happened if the price breaks the lower line of the flag can be seen on the AUDJPY? Here, the breakout happened at the end of the January and gave us a sweet drop for around 250 pips. Now, we are having a bullish correction. The price tries to create an inverse head and shoulders pattern but the buyers are struggling with the attack on the neckline. It looks like, they do not have enough power to do this, which can change this bullish iH&S formation into a bearish wedge in no time. Sentiment stays negative.
This article was originally posted on FX Empire
More From FXEMPIRE:
- Coronavirus, Powell and Gold
- USD/JPY Fundamental Daily Forecast – Jump in Coronavirus Cases Sparks Flight into Safe-Haven Japanese Yen
- E-mini S&P 500 Index (ES) Futures Technical Analysis – Trader Reaction to 3365.50 Sets the Tone Today
- Natural Gas Price Fundamental Daily Forecast – Strengthens Over $1.847, Weakens Under $1.829
- Oil Price Fundamental Daily Forecast – Russia Could Approve Cuts after OPEC, IEA Issue Bearish Demand Outlooks
- Three Excellent Trend Continuation Patterns on EUR/USD, GBP/USD and AUD/JPY