EUR/USD Price Analysis: More weakness ahead on Tweezer Tops formation, 0.9860 a key support
- A Tweezer Tops formation has created an intermittent hurdle for the asset.
- Declining 20-and 50-EMAs add to the downside filters.
- The Eurozone bulls weakened after surrendering the 1.0000 parity.
The EUR/USD pair is attempting a rebound after hitting a low of 0.9855 on Tuesday. It seems that a less-confident buying interest is a dead-cat bounce after a bloodbath in the risk-perceived currency. The asset witnessed a vertical downside momentum after failing to recapture the critical hurdle of 1.0200. The major extended its losses after surrendering the magical figure of 1.0000.
A formation of the Tweezer Tops candlestick pattern in which selling wicks are formed at similar levels indicates a continuation of the downside move. After concluding the inventory distribution at similar levels, a mark-down phase triggers an intense sell-off by the market participants.
The 50-period Exponential Moving Average (EMA) at 1.0132 has acted as a major hurdle for the shared currency bulls. Also, the 20-EMA at 1.0027 is declining, which adds to the downside filters.
Meanwhile, the Relative Strength Index (RSI) (14) is still holding above 40.00. However, a downside break will accelerate the downside momentum.
A break below Wednesday’s low at 0.9955 will drag the asset towards the round-level support of 0.9900, followed by a 19-year low at 0.9864.
On the contrary, the eurozone bulls could defy the downside momentum and make a comeback on overstepping the magical figure of 1.0000. An occurrence of the same will send the major towards 31 August high at 1.0080, followed by Monday’s high around 1.0200.
EUR/USD daily chart
