EUR/USD: Ichimoku analysis (May 16)
By Tatyana Norkina, FBS
During the past week EUR/USD declined even more. The pair broke down support of the lower limit of Ichimoku Cloud in the $1.3720 area, forming a new low for the past 3 months at $1.3650. Thus, the currency pair found itself below the Cloud, affecting the whole Ichimoku indicator: Tenkan and Kijun canceled the Golden Cross and headed down, while the Cloud switched to bearish. At the same time, the market became oversold. This can cause the short-term rebound to the lower border of the Cloud.
Chart. Daily EUR/USD
At H4 the Ichimoku indicator retained bearish tone. The Dead Cross remained in place, while the Ichimoku Cloud is still descending. However, at the end of the week the pair corrected to the lines Tenkan-sen and Kijun-sen which made all the lines turned sideways. Therefore, in the near future we can expect a short-term consolidation or restoration to the lower boundary of the Cloud.
Chart. H4 EUR/USD