EUR/USD Daily Outlook

Daily Pivots: (S1) 1.5601; (P) 1.5648; (R1) 1.5702; More

EUR/USD's fall from 1.6019 resumes in early European session by diving lower to 1.5539. At this point, intraday bias remains on the downside as long as 1.5664 minor resistance holds. As discussed before, EUR/USD should have at least made a short term top after completing a diagonal triangle that started at 1.5342 with bearish divergence condition in 4 hours MACD and RSI. Also, the diagonal triangle should also be the last advance in a five wave rally that started at 1.4309. Hence further decline is expected towards 1.5342 cluster support (38.2% retracement of 1.4309 to 1.6019 at 1.5366). On the upside, above 1.5664 will indicate that an intraday low is in place and bring recovery. But upside should be limited by 4 hours 55 EMA (now at 1.5754) and bring fall resumption.

In the bigger picture, firm break of 1.5342 support, which will also have EUR/USD sustaining below 55 days EMA (now at 1.5484) too, will confirm that rise from 1.4309 has completed with bearish divergence condition in daily MACD and RSI too. In such case, deeper decline should then be seen to 1.4309 and 1.4966 support zone. However, strong rebound will suggest that price actions from 1.6019 is probably just developing into another sideway consolidation. But still, risk is on the downside before sustained break of 1.6019 high.

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