EUR/USD technical analysis: Ends five-day losing streak, but bias remains bearish

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  • EUR/USD remains below key support-turned-resistance of 1.1162.
  • A flag breakdown on the 4-hour chart, if confirmed, would open the doors to levels below 1.10.

EUR/USD gained 0.19% on Wednesday, snapping a five-day losing streak, however, the outlook remains bearish as the pair is trading well below the former support-turned-resistance of 1.1162 (Aug. 12 low).

Further, the pair seems to have created a bear flag pattern on the 4-hour chart. A bear flag is a pause that usually ends up accelerating the preceding sell-off.

A break below 1.1065 would confirm a flag breakdown and create room for a drop to 1.09 (target as per the measured move method).

As of writing, the pair is trading at 1.1093. A 4-hour close above 1.1104 would invalidate the flag pattern. That said, a break above 1.1162 to invalidate the bearish put forward by the range breakdown on Aug. 14.

4-hour chart

Trend: Bearish

Pivot points

 

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