- EUR/USD’s daily chart candlesticks signal a short-term bearish reversal.
- The pair is trading in the red near 1.1838 at press time.
EUR/USD pair fell by 0.48% to 1.1855 on Wednesday, confirming a bullish-to-bearish trend change signaled by Tuesday’s inverted hammer.
Candlesticks like the inverted hammer, bearish engulfing required confirmation – further downside follow-through, typically a negative close on the following day.
While the candlestick arrangement has now turned bearish, the 14-day relative strength, too, has turned lower from the descending trendline hurdle, reinforcing the short-term bearish bias.
As such, a drop to the Aug; 21 low of 1.1754 looks likely. Acceptance under that level would shift the focus down to the 50-day simple moving average (SMA) located at 1.1631.
On the higher side, Wednesday’s high of 1.1929 is the level to beat for the bulls.