January has proven to be a bearish
month for EUR/USD. During the past 20 years the pair has been falling
with 70% in the first month of the year and the average decline within this
period is around 195 pips. Considering the monthly changes in the pair the last
three years are showing consecutive negative performance and the worst decline
was seen in January 2015.
With the start of 2017 the EUR/USD pair does not
perform differently. During today’s session a fresh new low was hit at 1.0340,
which is a level that has not been visited since January 3th 2003.
Technical readings are confirming the bearish trend.
As seen on the H4 chart the pair crossed to downside the 20-day moving average
and remains well below the 100-day and 200-day EMAs.
Indicators have recovered from oversold areas, but
still are located below mid-lines. RSI is currently being around 38% and is
showing lack of strength. Stochastic has retreated from the extremely oversold
area, but still is displaying week bearish momentum.
Another point that cannot be dismissed is that during
the last three sessions the pair is marking lower lows and lower highs, which
is additionally encouraging the bears.
Support is located at 1.0340 (today’s low) and 1.0300
(physiological level). Resistance is seen at 1.0450 (20-day EMA) and 1.0495
(100-day EMA).
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