EUR/USD is trading on a critical intraday support of 1.1730 and a break below this level is likely to send the pair lower towards 1.1670. The EU industrial production data released today is attributing further weakness to the pair. The number for the August came in at 0.7% compared to a forecast of 0.8%. The intraday support level is at 1.1730 while other support levels are at 1.1700 and 1.1670. The near term resistance is at 1.1755 another resistance is present at 1.1780 level.

The SMA-14 is indicating resistance area at 1.1741 and the SMA-50 is showing resistance at 1.1798. The Mid Bollinger band is at 1.17432 while the lower band support area is at 1.16200. The pair is currently near yesterday’s closing and forming a strong bearish pattern. A breach below 1.1730 on the 4-hourly chart is likely to trigger further sell offs in the pair which makes it ideal for intraday sell entries. A decent selling entry would be near 1.1735 with a target of 1.1680. A tight stop-loss for this trade would be just above the 1.1780 resistance area.

An intraday closing below 1.1700 is likely to accelerate the downtrend and the pair may drop until 1.1620 in coming days. On the upside, bulls need closing above 1.1830 to take the pair further higher.

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By LCMS Traders FX Analysis Team

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