EUR/USD technical analysis: On the defensive with flag breakdown on the daily chart

• EUR/USD's line chart shows a bear flag breakdown – a bearish continuation pattern. 
• Daily chart indicators are biased bearish with MACD histogram teasing a drop below zero. 
• The stage looks set for a deeper drop to 1.0820.

EUR/USD looks south with the daily line chart reporting a bear flag breakdown.

The flag breakdown indicates the sell-off from the Aug. 23 high of 1.1154 has resumed and the pair could drop to 1.0820 in the short-term. That target is arrived by subtracting pole height from the breakdown price.

Supporting the bearish case is the below-50 print on the relative strength index. The moving average convergence divergence histogram is also teasing a bearish reversal.

The bearish case would be negated if the pair violates the trendline falling from June 24 and Aug. 12 highs.

Daily chart

Trend: Bearish

Technical levels