EUR/USD posts huge bearish reversal post-Fed; bears need 1.3665 to crack

FXstreet.com (Barcelona) - The EUR/USD could still merely be in a short-term downside correction, but if 1.3665 is broken on a daily close, technicians say something more serious on the downside will be under way.

EUR/USD traders to react to light European and heavy US data Wednesday

After Wednesday’s Fed-induced downside fireworks, EUR/USD traders are having to double-check the charts to see if things have changed technically now that the Fed has changed things fundamentally (even if it was just an insignificant “token” change). As of the writing of this article, it appears that EUR/USD bulls still have one technical support level on which they are able to base any remaining optimism (see more on this below).

Thursday’s economic data points due out that may have an impact on the EUR/USD include:

• European Council Meeting
• EuroZone Current Account
• US Weekly Jobless Claims
• US Conference Board Leading Indicators
• US Existing Home Sales
• US Philly Fed Manufacturing Survey
• US 7-Year Note Auction

Technical outlook for EURUSD

Technicians say the EUR/USD is on the verge of confirming that the recent up move in the cross was just a massive correction higher that topped at 1.3810. If 1.3665 support is broken, this “correction” theory will be turning into reality. The next downside target would then be 1.3627 – the next Fibonacci projection line. If, by a surprising change in circumstances, the EUR/USD reverses back to the upside and takes out 1.3810, the next resistance level would be 1.3832.