The EUR/USD price dropped strongly after the first two days of trading last week, reflected by the two bearish candles with large wicks that had formed. Those wicks represented the price at the strong $1.13094 support level. On Wednesday, the price managed to break below the previous two day wicks, which was the start of a bearish move. And that move was confirmed the next day.
On Thursday, the price formed a large bearish candle that closed the day below $1.11871 support level. The support level did not have any reaction on the price, which tells us bearish pressure was too strong. This level lost its significance and the price is now below the downtrend channel.
EUR/USD Forecast 29.1.2022
What we can expect over the next few days is the price returning back to its resistance level at $1.11871, which is now a confluence of resistance, where horizontal support line and downtrend channel trend line cross. There the price will find resistance where more sellers will enter into the market and push the price further down.
Next support is at $1.10755, where we could expect the price to stop. From there the price has second level support below at $1.09860 and first resistance, at $1.11871.
Obviously, the price is in bearish mode and we can expect it will move further down. The price needs to close above $1.11871 just to return into range where bulls will have some kind of a chance to reverse the market sentiment.
To completely change the market sentiment, the price needs to close above $1.14000, which is above the previous price range.
Bears are now controlling the market where EUR strength is weak and strong support at $1.10755 is the first step to recovery.
