Look for a bearish tone over the short-run as long as the EUR/USD remains under the short-term Fibonacci level at 1.1265.The Euro is trading sharply lower against the U.S. Dollar on Thursday after Russian forces launched a full-scale invasion of Ukraine and European Union officials said they would impose new sanctions on Russia.
European Union leaders will impose new sanctions on Russia, freezing its assets, halting its banks’ access to European financial markets and targeting “Kremlin interests” over its “barbaric attack” on Ukraine, senior officials said on Thursday.At 13:24 GMT, the EUR/USD is trading 1.1169, down 0.0134 or -1.19%. On Wednesday, the Invesco CurrencyShares Euro Trust ETF (FXE) settled at $104.93, down $0.24 or -0.23%.
The single-currency is trading at its highest level since January 31 and appears to have enough downside momentum to challenge the January 28 main bottom at 1.1122.Today’s price action is the initial reaction to the news of the invasion. Once the EUR/USD stabilizes, we’re likely to see a volatile two-sided trade as investors assess the economic impact of a prolonged war. Professionals are assessing strategies for a quick takeover by Russia and for a long-term occupation.
Daily Swing Chart Technical Analysis.The main trend is down according to the daily swing chart. The downtrend was reaffirmed when sellers took out the previous main bottom at 1.1280. A move through 1.1389 will change the main trend to up.The short-term range is 1.1122 to 1.1495.The EUR/USD is currently trading on the weak side of its retracement zone at 1.1265 to 1.1308, making it the nearest resistance.
Look for a bearish tone over the short-run as long as the EUR/USD remains under the short-term Fibonacci level at 1.1265.Taking out the intraday low at 1.1155 will indicate the selling is getting stronger with 1.1122 the next target. This level is a potential trigger point for an acceleration to the downside.
On the upside, overcoming 1.1265 will signal the return of buyers. If the buying strengthens then look for a move into 1.1308. This is a potential trigger point for an acceleration into 1.1389 to 1.1407.
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