The Euro (EUR) extended downside movement against the US Dollar (USD) on Wednesday, dragging the price of EUR/USD to less than 1.0775 following the release of some key economic news. The technical bias remains extremely bearish because of a Lower Low in the ongoing downside wave.
As of this writing, the pair is being traded around 1.0751. A support may be noted near 1.0711, the immediate horizontal support ahead of 1.0522, the swing low of the last major downside move on the weekly chart and then 1.0000, the parity level.
On the upside, the pair is expected to face a hurdle near 1.0817, the intraday high of yesterday ahead of 1.0860, the horizontal resistance zone and then 1.1000, a major psychological level as demonstrated in the above chart. The technical bias shall remain bearish as long as the 1.1300 level is intact.
Eurozone GDP rose 0.3% in the third quarter according to the flash data released by Eurostat. This was in line with market expectations and also in line with the rate recorded for the second quarter. In annual terms, there was a 1.6% gain, also unchanged from rate seen for the previous quarter and a slight slowdown from the 1.7% rate seen for the first quarter of 2016. There is the potential for the overall Eurozone economy to strengthen at a slightly faster pace in the fourth quarter given that there is likely to be a stronger performance for Germany.
Considering the overall technical and fundamental outlook, buying the pair around current levels may be a good strategy if we get a valid bullish reversal candle on the daily chart.