Search ForexCrunch

EUR/USD fell 0.64 percent on Friday, validating the bearish inside day candle created on Thursday.  

An inside day occurs when the high and low falls within the price range of the previous day and is widely considered a sign of indecision. A bearish follow-through, preferably a close below the low of the inside day, is considered a sign of bullish-to-bearish trend change.  

On Friday, the spot closed well below the low of 1.1343 hit on Tuesday, confirming a bearish reversal. Hence, the path of least resistance is now to the downside and a deeper drop toward 1.1234 (Feb. 15 low) could be in the offing.  

That said, a repeated failure to penetrate 1.1280 (61.8% Fib R of 1.1176/1.1448) would weaken the immediate bearish pressure. As of writing, the pair is trading at 1.1298.

Daily chart

Trend: Bearish