EURUSD Tech analysis by Simon Kazinsky on 19:29 September 27, 2019 EST
The dollar holds a lot of momentum while the Euro remains weak against most of the main world's currencies and now that the short term rally wanes we could see the downtrend getting legs.
The current decline that starting in January 2018 from the 1.25 has been orderly and gentle unlike previous descends that were short and sharp however that could change easily in due course as the trend is becoming clearer, perhaps Britain, still one of the European powerhouses, leaving the EU at the end of October will act as the catalyst and precipitate the outcome.
We would have to see EURUSD travel north and reach 1.1250 and above to start considering a reversal half seriously and to reach 1.20 to think that the long term trend may have come to an end.
Meanwhile, as you may guess, retail traders are betting that we are at the bottom and the reversal will take place now, around 7 out of 10 retail traders are long. This is great news because it validates even further our bias.
If previous divergences with the 6 months moving average can give us an indication of what may happen in the medium term we could drop well below parity against the dollar in the coming months.