Ichimoku analysis (4-hour chart)
Tenken-Sen- 1.07255
Kijun-Sen- 1.07922
EURUSD extended its bearish trend on upbeat US ISM services PMI data. The pair is holding well below 55-W EMA and currently trading around 1.07123.
US ISM services PMI rose to 54.50 in August, compared to a forecast of 52.50. The US dollar index gained momentum after US ISM services hit the strongest level since Feb.
According to the CME Fed watch tool, the probability of a no-rate hike in Sep increased to 93% from 90% a week ago.
The US 10-year yield jumped more than 6% from a temporary low of 4% on the strong US ISM services PMI. The US 10 and 2-year spread narrowed to -69% from -86.4%.
The pair trades below short-term 21 EMA, 55 EMA, and long-term (200-EMA) in the weekly chart. Any break below 1.0700 confirms further bearishness. A decline to 1.0660/1.0600 is possible. The near-term resistance is around 1.0760, any breach above targets is 1.0800/1.0880.
Indicator (4-hour chart)
CCI – Bearish
Directional movement index – Bearish
It is good to sell on rallies around 1.0765-68 with SL around 1.0820 for a TP of 1.0600.
