Technical outlook:
EURUSD is once again testing lows close to the 0.9530-40 levels before carving a potential bottom soon. The single currency dropped through the 0.9540 lows during the early Asian session on Wednesday and has now pulled back through 0.9555. Short-term resistance is seen at the 0.9700 handle and a push higher is required to confirm an interim bottom in place.
Early this week, EURUSD hit a major Fibonacci target close to 0.9600 as projected on the daily chart. Prices should be up for a meaningful corrective rally soon following a multi-month downtrend from the 1.2350 highs registered in January 2021. The potential remains for a push through 1.0600 which is also the Fibonacci 0.382 retracement of the entire drop as seen on the daily chart.
At this point in writing, there is no price action confirmation of a bullish turn but traders will be looking for a push through the 0.9700 initial resistance to initiate fresh long positions. Immediate resistance on the daily chart is at 1.0200, which could be the next target for bulls to come back in control. Watch for a 150-pips rally from the current levels.
Trading idea:
Preparing for a potential rally towards at least 1.0200 against 0.9500
Good luck!
