EUR/USD: Resistance at 1.1270 caps, risk is skewed to the downside

The EUR/USD pair has started the week gapping lower amid a persistent dismal mood as is capped by a Fibonacci resistance level at 1.1270, as FXStreet’s Chief Analyst Valeria Bednarik notes.

Key quotes

“The EU released the April Trade Balance, which posted a seasonally adjusted surplus of €1.2 billion, much worse than the anticipated €22.9 billion. The US, on the other hand, has just released the June NY Empire State Manufacturing Index, which came in at -0.2, much better than the expected -27.5 and improving from -48.5 in May.”

“The EUR/USD pair is trading around 1.1250, capped by the 23.6% retracement of its latest bullish run at 1.1270. The 4-hour chart shows that the 20 SMA has turned lower above the current level, although the 100 SMA continues advancing below it, now nearing the 38.2% retracement of the same rally at 1.1175. Technical indicators, in the meantime, remain within negative levels, without clear directional strength.”