Technical outlook:
EURUSD continues to print lower lows with the recent one registered at around 0.9952 on Thursday. The single currency pair has pulled back since then and is trading close to 1.0025 at this point in writing. Please note that the Fibonacci 0.618 extension of the drop from 1.2350 to 1.0350 is seen at about 0.9500. It remains to be seen if bears will continue from here or after a pause.
EURUSD has carved a meaningful downswing between 1.2350 and the 0.0952 lows as bears remained in control. If the drop is complete, we can expect a sharp bullish reversal from the current level of 1.0025 heading toward the 1.0615 resistance seen on the daily chart. Also, note that short-term resistance is seen towards 1.0125 and a break there would confirm the first step towards a potential bullish reversal.
The euro bulls are looking poised to come back in control soon and push prices towards 1.0900, which is the Fibonacci 0.382 retracement as projected on the chart here. On the flip side, a continued slide below 0.0952 will ensure bears remain further in control and drag towards the 0.9500 mark in the next few trading sessions.
Going forward:
EURUSD prints lower lows accompanied by a bullish divergence on the RSI on lower timeframes (not seen here). This is a sign of a potential bullish reversal pushing through 1.0615. A push above 1.0400 will also confirm that bulls are entering the market and that they are targeting above 1.0615 in the near term. Only a continued drop below 0.0952 will nullify the bullish structure.
Trading plan:
Preparing for a potential rally towards 1.0615 soon.
Good luck!
