Since last week, and the fall following the ECB meeting, the EUR/USD pair has confirmed a figure graphic in the Shoulder-Head-Shoulder full daily data, suggesting a bearish reversal which could be to target the area of 1.1250.
In fact, the line of the neck situated towards 1.1670 was broken last Thursday, and this break was all the more important that it was also a break in the MM100 days.
By measuring the distance between the head of the figure and the neck line, we can define a design target in the area of 1.1250, which suggests a potential drop of about 400 pips to current price.
This figure chart of the medium term could also be consistent with the news which we can expect for the next few months, with the ECB, which announced last Thursday that an extension of QE, in contrast with the Fed which his side has already begun its rate normalization process (divergence of monetary policy penalising for EUR/USD).
To return to the factors of graphs, one can note that a return above 1.17 in daily close would begin to invalidate the outlook for a downward suggested by the current technical context.
Chart EUR/USD D1
See also our charts EUR/USD in real time.
This chart has been realized with the trading platform TradingStation 2 provided by FXCM France.