The EURUSD had a significant bearish momentum on Friday as US NFP and Unemployment rate surprised us with much better than expected numbers. While investors might see not enough reasons to hold the Euro after Trichet said on ECB press conference that Euro economy will remain weak this year,Â US Dollar is likely to have all the advantage as safe heaven currency. So I am expecting a stronger Dollar.
My technical study on both daily and weekly chart suggests a bearish view. On weekly chart below, we can see that after significant bullish rally since March, a shooting star appeared, indicating potential bearish reversal. At the same time, we have CCI divergence.
On daily chart, we have false breakout from the range bound area, and false breakout usually lead to significant reversal. However, CCI in overbought area and about to cross the -100 line up on h1 chart so watch out for a potential upside correction testing 1.4200 and 1.4270 resistance area. Only a break above 1.4336 should be considered as potential threat to the bearish scenario. The medium outlook should remains neutral with expected strong support seen at 1.3750 area.