EUR/USD Mid-Day Outlook

Daily Pivots: (S1) 1.4696; (P) 1.4752; (R1) 1.4809; More

EUR/USD's recovery from 1.4571 continues today btu still, further fall is in favor as long as 1.4807 minor resistance holds. Below 1.4571 will encourage decline to key medium term support at 1.4309. However, above 1.4807 will be an important indication that a short term bottom is finally in place, with bullish convergence condition in 4 hours MACD and RSI. Break of 1.4908 will confirm and bring stronger rebound to test 1.5284 double top neckline resistance before staging another fall.

In the bigger picture, the double top reversal pattern (1.6019, 1.6038) serves as an important signal of completion of medium term rise from 1.1639 (05 low), which is supported by the decisive break of 55 weeks EMA While it's still early to conclude, recent development continues to build up the case of a medium term reversal. Focus will now be on a) whether key support level of 1.4309, (38.2% retracement of 1.1639 (05 low) to 1.6038 at 1.4358, 61.8% retracement of 1.3262 to 1.6038 at 1.4322) will hold; b) whether next trend line support (1.1825, 1.2483, now at 1.4359) will hold; c) whether weekly MACD will turn negative and d) whether monthly MACD will cross below signal line.

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