The EUR/USD rallied in the early hours of the previous day’s trading session but found resistance at 1.36765 and started to decline after fundamental reports showed that the Sentix investor confidence index fell to 8.5 this month from 12.8 in May, confounding expectations for a jump to 13.2. Furthermore, the European Central Bank’s recent decision to loosen policy coupled with expectations for the Federal Reserve to wind down stimulus programs this year reflected in bond markets on Monday, which weakened the euro and fueled widespread demand for the dollar.
Intra-day bias remains on the downside as a fresh cross of 21 and 55 EMA’s were seen on the hourly charts. MACD and RSI oscillators are also signalling bearish continuation to the downside as price was able to close below weekly central pivot. More supply to 1.35373 is expected and a break of such support would see price to retest 1.35018, the low of Thursday made by the ECB announcement. Also on the 4 hours chart we can see a sell pin bar reversal price action seen around the 1.36751 resistance region with also 21 and 55 EMA’s trying to diverge to the upside on the 4 hours charts but lacked an upward momentum before diverging back to the downside.