EUR/USD looking to continue the dip

EUR/USD finally managed to break back into its long term downwards trend and it seems that it will look to continue this move below 1.3800 level. At the moment traders will be simply looking to sell EUR/USD on rise to reasonable retracement levels and sell again with the aim to extend the profits as the market moves in the long term trend. First such retracement level can be seen at 1.4050 level which seems a bit extended but keeping in mind the sharp dip taken, it seems quite reasonable. Although we might see EUR/USD taking couple of days to get towards this retracement level and traders will look to sell around 1.4050 level. In case the EUR/USD extends its retracement, it will look to target 1.4140 level and that will really setup things especially for long term traders looking to target large profits. The initial targets will be around 1.3860 level and in case the move is extended the next level will be around 1.3790 level.

Considering the moving averages, used in daily charts, they are all pointing downwards and the downward trend is very much indicated by them. RSI seems to play an important part at the moment as it is on the lower side around 34 and sooner or later it will be pushing EUR/USD for a retracement.

 

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