The EURUSD may have given us the second bearish fakeout at 1.0930 this year.
On February 1st, the euro closed above 1.0930 after holding below it for a week.
However, the pair closed back below the key level on the very next candle.
That confirmed a bearish fakeout (also called a deviation), triggering a 390-pip drop.
The EURUSD found resistance at the same 1.0930 key level between March 22nd and April 3rd and closed Tuesday’s session above it.
But like in February, euro bulls failed to hold 1.0930 as new support on Wednesday.
So we could have another bearish fakeout to trade next week.
That said, the 1.0900 level continues to prop up the EURUSD on a daily closing basis.
You can see how 1.0906 was the March 30th close, and so far, EURUSD has found support here on the daily time frame.
With that in mind, I’d like to see a daily close below 1.0900 next week to confirm the bearish fakeout and expose levels like 1.0750.
Another confirming indicator next week will be the US Dollar Index (DXY).
I’ve mentioned this 101.00 macro support area for the last few weeks.
The DXY caught a bid at 101.50 this week and has so far reclaimed the March 23rd low, although it was a marginal close on Thursday.
However, I’d like to see the dollar index reclaim 102.05 in the next few days to confirm further upside toward the 102.60 monthly open and potentially the 103.50 yearly open.
That would help solidify the bearish idea for EURUSD.
A EURUSD daily close below 1.0900 next week would open up 1.0750, while a move above 1.0973 opens the door to 1.1030.
