Technical outlook:
EURUSD bounced back from nearly 1.0100 on Wednesday post the FOMC. The price action was in line with expectations for a potential bullish bounce from the 1.0075-1.0100 area. The single currency pair bounced off 1.0104 and is seen to be trading close to 1.0215 at this point in writing. In the near term, the potential remains close to 1.0800 as projected on the daily chart.
Earlier, the euro bears managed to drag prices from the 1.2350 highs through the 0.9952 lows in the past 18 months since January 2021. The entire downswing might have completed at 0.9952 as prices have bounced sharply by over 300 pips and climbed to 1.0273 recently. If the above-proposed structure is correct, the counter-trend rally might be unfolding now against 0.9952.
The EURUSD bulls are inclined to remain in control from here, pushing prices through the 1.0800-1.0900 zone in the next few weeks. Also, note that the Fibonacci 0.382 retracement of the entire drop is seen through the above zone. Hence, the odds are high for a bearish reversal if prices manage to reach 1.0800.
Going forward:
EURUSD is expected to stay above interim support at 1.0104 and continue pushing through 1.0800. Also, note that the potential still remains for a drop towards 1.0075, which is the Fibonacci 0.618 retracement of the upswing between 0.9975 and 1.0273 before resuming its rally. All in all, look higher from here until 0.9952 remains intact.
Trading plan:
Potential rally towards 1.0800-1.0900 against 0.9952
Good luck!
