Euro’s break below 1.1429 () has opened doors for a slide to 1.12 levels.
The monthly chart now shows a “Gravestone Doji” formation.
It was very essential for the bulls to ensure the spot stayed above 1.1534 levels. However, not only the pair retreated from a high of 1.1616, but it also fell below 1.1534 levels on closing basis and printed a low of 1.1418 levels.
Failure to sustain above key zone of 1.1436-1.1534 levels despite rising to 1.1616 indicates the currency pair could be heading lower to 1.12 levels.
The move may not happen in a day or two; although probability of such a drop in high if tomorrow’s US wage growth figures are strong.
As of now, the spot is likely to see fresh offers on upticks unless and the bearish invalidation is seen only in case of spot closing above 1.1534 levels.