After a sharp reversal from a major uptrend, the euro-dollar pair has begun to fall—watch for further downside potential

After a sharp reversal from a major uptrend, the euro/dollar pair has begun to fall—should we be wary of further downside potential?

14.03.2025

In U.S. currency trading the previous day, the Canadian dollar fell against the yen. The CAD/JPY pair fell from 103.284 to 102.054.The pair fell as it encountered resistance at the 200-period SMA on the hourly chart. On the 4-hour chart, the 75-period MA is capping gains, and on the daily chart, the downtrend along the 10-period MA continues. We need to remain vigilant to see if the Canadian dollar’s weakness will persist during U.S. trading hours.

Among European currencies, the euro fell against the U.S. dollar. The EUR/USD pair dropped from 1.0896 to 1.0822, continuing its decline along the 20-period moving average on the hourly chart.On the 4-hour chart, the price has been ranging between the +2σ and -2σ levels of the Bollinger Bands, and on the daily chart, as on the 4-hour chart, the price has pulled back from the +2σ level of the Bollinger Bands. We should keep a close eye on the direction of the euro, which has now fallen for two consecutive days.

At 16:00: Germany’s Wholesale Price Index, UK Monthly GDP, Germany’s Consumer Price Index, UK Industrial Production, and UK Manufacturing Orders; at 16:45: France’s Consumer Price Index; at 21:30: Canada’s Manufacturing Sales and Canada’s Wholesale Sales;and at 23:00, the U.S. University of Michigan Consumer Sentiment Index is scheduled to be released. With the EUR/USD pair having reversed course from its strong rally and entered a downtrend, traders should pay close attention to its downside potential.