EURUSD – Selling Continues But Divergence Remains

The euro has broken lower against the dollar again today following a short period of consolidation and 1.07 is once again coming under some pressure.

Prior to this move we had seen a divergence appearing in the pair, with the stochastic making higher lows even as the pair fell from 1.0865 to 1.0707. This suggested that the move may be losing some momentum and today’s selling could confirm this.


At the moment it’s too early to tell but the ongoing divergence is still possible and the same could form on the MACD histogram.

It should be noted that while this should act as a red flag for a possible correction, it is secondary to price action which continues to look bearish at this stage.


If the pair continues to push lower then it could find support again around 1.0650. Below here, further support could be found around 1.0520 followed by this year’s lows, around 1.0460.

Craig Erlam
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the BBC and The Telegraph, and he also appears regularly as a guest commentator on Bloomberg TV, CNBC, FOX Business and BNN. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.