EUR/USD technical analysis: Drops below 1.12, teasing flag breakdown

• Dollar demand pushes EUR/USD below 1.12. 
• A close below 1.1204 would confirm a flag breakdown

EUR/USD printed session lows below 1.12 soon before press time.

The US Dollar is pushing higher against most majors on lower odds of an aggressive Federal Reserve rate cut at July 21 meeting.

Meanwhile, the shared currency could be losing altitude due to a widespread belief that the European Central Bank would cut rates by 10 basis points in September and restart the quantitative easing program later this year.

On the daily chart, EUR/USD is teasing an inverted flag breakdown, a continuation pattern which usually accelerates the preceding bearish move.

A daily close below 1.1204 would confirm flag breakdown and create room for a drop to fresh 2019 low below 1.1107.

On the higher side, the July 11 low of 1.1286 is the level to beat for the bulls. As of writing, the pair is trading at 1.1195, having hit a high of 1.1210 earlier today.

Daily chart

Trend: Bearish

Pivot points