EUR/USD outlook: a new downward channel has been formed

The EUR/USD pair fell on Thursday to a low of 1.1225, as the disappointing PMI data was released in Germany and the Eurozone. First, data on Germany’s manufacturing PMI for April came out at 44.5, not meeting analysts’ expectations regarding the indicator 45.0. Later, data on manufacturing PMI for April in the Eurozone amounted to 47.8, against analysts’ expectations regarding 47.9.

In addition to this, the index of business activity in the services sector in the Eurozone in April was 52.5, against 53.2. Data on retail sales in the US stepped down the Euro. Today in Western Europe and the USA, the exchanges do not work because of the Easter holidays, so the quotes are moving in a narrow range.

EUR/USD Technical Analysis 19^th April 2019

The Euro started a major downside move from the 1.1320 resistance area against the US Dollar. The EUR/USD pair traded below the 1.1300 and 1.1285 support levels to move into a bearish zone.

The pair even broke the 1.1255 support and traded towards the 1.1220 level plus the 50 hourly simple moving average. A swing low was formed at 1.2226 and the pair is currently correcting higher.

On the upside, there is a strong resistance formed near the 1.1255 level and the 38.2% Fib retracement level of the last decline from the 1.1303 high to 1.1226 low. Above 1.1255, there is a connecting bearish trend line at 1.1275 on the hourly chart.

Therefore, upsides are likely to remain capped in EUR/USD near 1.1255 or 1.1270, and the pair is likely to decline again towards the 1.1220 level.

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