FXStreet (Guatemala) - EUR/USD downside exposed after 400 pip sell off last week, with offers opening with a low of 1.0998 as price oscillates around the 1.110 level at the start of the week.
EUR/USD is back under pressure instigated by the PBoC making further moves to spur on the economy which propelled stocks into 5th gear resulting in the euro playing out its part in a funding currency. On the same week, Draghi explained that the ECB is in amber in respect of being ready to act accordingly while China and EM's are weighing heavy on the EZ's ability to recover, despite QE having the attended effects domestically.
While it is widely expected that the US economy has not done enough for the FOMC to call for a hike this month at this week's FOMC meeting, there is still the possibility of a Fed hike before the year is out and the divergence between the two Central Banks exposes the downside in the euro. The week ahead is jam packed of data to leave you glued to the screens at critical levels across the board.
EUR/USD levels
Technically, the break of the 200 DMA was significant, currently trading at 1.1121 and on the 4hr, the 20 SMA crossing down through the 200 SMA leaves the divergence in the biggest disparity between the cluster of MA's on the same time frames the largest since the August rally. The downside targets now bring in the 30 year channel at 1.0560 and 1.0457. For the near term, S2 stands at 1.0935 ahead of S3 at 1.0770. 1.1100 on the upside comes as first resistance ahead of the pivot at 1.1187.
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