- EUR/USD has created an H&S pattern on the 4-hour chart.
- A breakdown would open the doors for a re-test of levels below 1.10.
EUR/USD looks to have formed a head-and-shoulders (H&S) pattern on the 4-hour chart.
Acceptance below the neckline support, currently at 1.1196, would confirm breakdown or bearish reversal pattern and open the doors to 1.0970.
On the flip side, a move above the left shoulder’s high of 1.1315 would invalidate the lower highs setup on the 4-hour chart and restore the immediate bullish setup. That will likely yield a re-test of the recent high of 1.1422.
However, a drop to the neckline support at 1.1196 looks likely as the daily chart MACD histogram has crossed into a bearish territory below zero. In addition, the long upper wick attached to the current weekly candle is suggestive of buyer exhaustion.
4-hour chart
Daily chart
Trend: Bearish
Technical levels
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