EUR/USD Daily Outlook

Daily Pivots: (S1) 1.3885; (P) 1.4014; (R1) 1.4113; More

EUR/USD's break of 1.3965 minor support indicates that recovery is completed at 1.4130 and intraday bias is flipped back to the downside for a retest of 1.3793 cluster support (38.2% retracement of 1.2884 to 1.4337 at 1.3782). Note that sustained break there will confirm that rise from 1.2884 has completed at 1.4337 already, in form of a head and shoulder top. In such case, deeper decline should be seen to test channel support at 1.3314 next). On the upside, above 1.4143 will turn intraday outlook neutral again and aurge that EUR/USD is indeed bounded in sideway consolidation.

In the bigger picture, price actions from 1.2329 are treated as consolidation in the down trend from 1.6039 only, with first leg completed at 1.4719, second at 1.2456. Break of mentioned 1.3793 support will indicate that the third leg from 1.2456 has completed at 1.4337 too and deeper decline should be seen to 1.2456/2884 support zone. Though, in such case, as we're favoring that it's developing into triangle consolidation, downside should be contained by 1.2456/2884 support zone and bring one more rise to complete the consolidation. On the upside, while another rise cannot be ruled out for the moment, focus will remain on reversal signal as EUR/USD approaches trend line resistance (now at 1.4427).

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