EURUSD – bears maintain control, with consolidation likely before a potential break below the key 1.1500 support area

The Euro remained under pressure at the start of the week, trending lower and testing the 1.1500 support area (a round number level and the 50% retracement of the 1.1065–1.1918 rally) during early Monday trading.

The current bearish leg, which began after a double bull-trap formation at the base of the thick daily cloud, has extended for a fourth consecutive session.

A decisive break below the former higher base at 1.1542 has completed a bearish failure swing pattern on the daily chart, reinforcing the negative short-term outlook.

Bearish momentum continues to strengthen, supported by the diverging Tenkan-sen and Kijun-sen lines in a clear bearish setup, while the 55DMA and 100DMA are converging and could soon form a bearish crossover.

A firm break below the 1.1500 zone would likely trigger further downside, targeting the next support around 1.1400 (61.8% Fibonacci retracement and a key higher base from July 30 – Aug 1).

However, oversold conditions could temporarily slow the decline and lead to brief consolidation around 1.1500 before another potential push lower. Any extended uptick should be limited below the 1.1590 zone, which aligns with the broken trendline support, the 61.8% retracement, and the descending 10DMA.

A stronger U.S. dollar, following the Fed’s recent hawkish rate cut that reduced expectations for another cut in December, continues to weigh on the Euro. Moreover, the U.S. central bank may refrain from further moves until it gains clearer insight into labor market conditions, particularly as concerns over persistently high inflation remain.

Res: 1.1542; 1.1590; 1.1611; 1.1640
Sup: 1.1500; 1.1446; 1.1391; 1.1322