Technical outlook:
EURUSD remains vulnerable to extend its losses after reversing sharply from 1.2240/50 zone last week. As depicted here, the above zone was very close to the fibonacci 0.618 retracement of the drop between 1.2350 and 1.1950 respectively. The single currency is seen to be trading lower around 1.2045 levels at this point in writing and is expected to print lower lows and lower highs going forward.
Immediate resistance is now at 1.2245, followed by 1.2350; while support is close to 1.2000, followed by 1.1950 levels respectively. After having reversed from 1.2240/50 last week, EURO bears might be inclined to stay in control and drag prices lower towards 1.1600 in the next several weeks. In the next 1-2 trading sessions a counter trend rally might materialize towards 1.2175 levels before turning lower again.
Ideally, EURUSD should stay below 1.2350 levels to keep the bearish structure intact. Also, a break below 1.1950 would accelerate the drop and push through 1.1600 price support. Looking at the overall daily chart wave structure, potential remains for a drop towards 1.1200/1.1300 levels, which is close to fibonacci 0.618 retracement of the entire rally between 1.0636 and 1.2350 levels respectively.
Trading plan:
Remain short against 1.2350, target is @ 1.1600.
Good luck!
