Outlook for the euro turning bearish in short-term: Technicals advocating break lower to 1.311-1.305

The euro (Currency:EUR) is sitting tight on the foreign exchange markets this morning, a look at the latest spot exchange rates shows:

The euro dollar exchange rate is flat on Friday night's closing rate at 1.3347.
The euro pound exchange rate is 0.07 pct in the red at 0.8492.
The euro Australian dollar exchange rate is 0.46 pct in the red at 1.3887.

Please note that the above quotes are taken from the wholesale spot markets - your bank will affix its own discretionary spread when passing on a retail rate. However, an independent FX provider will guarantee to undercut your bank's offer, thus delivering more currency. Please read more here.

Outlook for euro dollar exchange rate could be sideways

UniCredit Bank tell us that the trend for the FX majors, GBP included, could well be sideways this week:

"Investors are unlikely to take heavy positions in advance of the Fed and SNB meetings later this week and, given the light agenda, FX majors are likely to trade sideways, provided stocks do not become too nervous."

"EUR-USD is likely to further struggle, mostly in the 1.33-1.34 band, but a steady Fed meeting outcome and higher EU PMI surveys this week are also ultimately expected to be EUR supportive."

Technical outlook advocates for further downside in euro dollar

Friday saw a substantial push to the downside, back through support at 1.334, signalling the potential for a new bearish phasing to the trend.

According to Joshua Mahony at Alpari UK the near-term bias for the euro is lower:

"The Friday close exactly on the 61.8 Fibonacci highlights it as key support and provided an unclear picture of where this pair in expected to go today.

"This morning has seen a move below support, currently trading around 1.332, bringing about a possibility of further downside momentum over the coming week.

"The stochastic and CCI indicators both point to an overbought and thus some form of consolidation would make sense. However, given the experiences of Thursday and Friday, the current candle must close below support to increase the view that there is further downside to come.

"Such a move would bring a target level of around 1.311-1.305. This encompasses the 100 and 200 moving averages, along with the 38.2 retracement of the February - April downtrend and 50.0 retracement of the recent May – June uptrend."