EUR/USD struggles with the 23.6% Fibo

EUR/USD struggles with the 23.6% Fibo

'The euro was for many years before seen as a more expensive currency, but now it's not so obvious given the prospects of tapering. Draghi promises more accommodation if necessary for years to come.' - UralSib Financial Corp. (based on Bloomberg)

Pair's Outlook

It seems that bullish momentum from the bounce form the 50% Fibo (July to August move) has worn off as at the moment the pair is struggling with the 23.6% retracement. For the time being 20 and 55-day SMAs with the help of weekly R1 were able to keep the pair supported, but it might be that bearishness given by the short term technicals will take upper hand. It becomes even more likely when we remember that 61.8% retracement awaits testing.

Traders' Sentiment

Situation in the market remains largely unchanged as greenback remains second most bought (in 60% of cases) currency across the board. Bears hold majority (60%) of all open positions. It is a marginal increase since yesterday. Distribution of pending orders is exactly the same-51% against 49% with the bears holding marginal upper hand.