EUR/USD Technical Analysis: Risks skewed to the downside

• EUR/USD has violated a rising trendline on the daily chart. 
• A close above the 200-day average is needed to revive the bullish setup. 

EUR/USD is looking south and could drop to the 50-day average support at 1.1080. 

The pair repeatedly faced rejection above the 200-day average in the four days to Dec. 17 and fell by 0.32% on Wednesday, violating the trendline rising from Nov. 29 and Dec. 11 lows. 

The breakdown of the ascending trendline is backed by lower highs on the daily chart MACD histogram - a sign of weakening of bullish momentum. 

Further, the 14-day relative strength index has dived out of an ascending trendline. 

Hence, the path of least resistance appears to be on the downside. A daily close above the 200-day MA at 1.1150 is needed to revive the short-term bullish setup. 

Daily chart

Trend: Bearish

Technical levels