Forex Technical Update

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EUR/USD 1H Chart 7/12/2012 6:38AM EDT

EUR/USD

The EUR/USD is breaking below the 1.22 level ahead of the 7/12 US session, continuing a bearish swing that started late June, early July. This is continuing a breakaway from June's corrective rally back into the bearish mode that started earlier in the year in February.

The 1H RSI shows persistent bearish momentum with the reading holding below 60 after dipping below 30 .

The daily RSI reading is showing similar bearish momentum building in a larger degree.

EUR/USD continues to hold the bearish outlook toward the 2010 low at about 1.19. We should also expect the 1.20 level to be a psychological barrier. (Refer to the weekly chart below the daily chart)

At this point, this bearish outlook should be valid unless a pullback pushes above 1.24, in which case we can expect a significant period of consolidation, and unclear or sideways direction. Only a break above 1.30 should bring up the bullish outlook in this degree.

EUR/USD Daily Chart 7/12/2012 6:39AM EDT

EUR/USD

EUR/USD Weekly Chart 7/12/2012 6:49AM EDT

EUR/USD

Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.

Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.