Talking Points:
- EUR/USD Technical Strategy: Short at 1.3654
- Support: 1.3561 (61.8% Fib ret.), 1.3459-76 (Feb 3 low, 76.4% Fib ret.)
- Resistance:1.3643 (50% Fib ret.), 1.3726 (38.2% Fib ret.)
The euro appears likely to continue lower after prices slumped to the lowest level in almost four months against the US dollar. Sellers are now aiming to challenge the 61.8% Fibonacci retracement at 1.3561, with a daily close below that level exposing the 1.3458-76 area marked by the February 3 low and the 76.4% level. Alternatively, a turn above resistance at 1.3643, the 50% Fib clears the way for a test of the 38.2% retracement at 1.3726.
We shorted EUR/USD at 1.3654 and subsequently booked a profit on half of the position. The rest of the trade remains open to take advantage of any further weakness, in line with our long-term fundamental outlook. The stop-loss is now at the break-even level.