Intraday Market Analysis – Euro Struggles to Bounce Back 2021-10-07

EURUSD weighed by bearish momentum

The euro remains under pressure after flat retail sales in August. The euro saw an acceleration to the downside from a drop below November’s low around 1.1620.

The lack of support suggests a strong bearish bias. After previous buyers bailed out, traders are looking for opportunities to go short.

Temporary rebounds are likely to attract more selling interest. An oversold RSI may offer temporary relief.

1.1610 would be the first resistance in case of a bounce. Further down, 1.1500 would be the next support.

NZDUSD tests demand area

In a textbook ‘buy the rumor, sell the news’ fashion, the kiwi slipped after the RBNZ raised its cash rates by 25 basis points.

The latest rebound has met stiff selling pressure at 0.6980. A bearish MA cross on the daily chart indicates a deterioration in sentiment.

The New Zealand dollar has given up most of its gains from the late August rally. A fall below 0.6875 would test the critical floor at 0.6810.

An oversold RSI has gathered some bids. A bearish breakout would trigger an extended sell-off to 0.66s.

USOIL hits psychological resistance

WTI crude fell after the EIA reported an unexpected rise in US inventories. The price action has met strong resistance near the psychological level of 80.00.

While sentiment remains bullish after a break above 76.50 on the daily chart, signs of overextension may cause a pullback.

Profit-taking is likely to weigh on the momentum, especially after the RSI shot into the overbought area.

76.00 from the previous supply zone is now the immediate support. Below that, 73.00 is the first key support on the daily timeframe.