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EURUSD has displayed a fresh wave of weakness, breaching a key support level. This analysis examines the technical situation and explores potential scenarios for the currency pair.

Sharp Decline Witnessed:

• Support Broken: EURUSD has fallen sharply from a high of 1.0942, decisively breaking below the support level at 1.0834. This technical breakdown suggests a potential strengthening of the downtrend.
• 1.0801 Next Target: Further decline appears likely in the near future, with the next potential target zone around 1.0801. A breakdown below this level could trigger a more extended decline towards the 1.0720 area.

Signs of a Potential Rebound:

• 1.0850 Initial Resistance: While the immediate outlook is bearish, a possibility for a bounce still exists. The initial hurdle to overcome for the bulls is the resistance level at 1.0850.

Uptrend Resumption Signal:

• Falling Trend Line Resistance: A more significant indication of a potential trend reversal would be a breakout above the falling trend line resistance on the 4-hour chart.
• Downtrend Completion: Overcoming this technical hurdle would suggest a possible completion of the downtrend that began at 1.0981.

Overall Sentiment:

The technical outlook for EURUSD leans bearish in the short term. The breakdown below 1.0834 support indicates a potential continuation of the downtrend. A minor consolidation followed by a decline below 1.0801 could exacerbate the bearish momentum. However, a bounce above 1.0850 or a breakout above the falling trend line resistance could signal a potential trend reversal towards the upside. Close monitoring of price action around these key levels will be crucial in determining the future direction of EURUSD.

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