EUR/USD Mid-Day Outlook

Daily Pivots: (S1) 1.3832; (P) 1.3985; (R1) 1.4081; More

As discussed before, rebound from 1.3747 has possibly completed at 1.4137. The three waves corrective structure revive the case that fall from 1.4337 is still in progress. Nevertheless, we'll stay neutral for the moment until a break of 1.3826/4137 to clear out the picture. Below 1.3826 will affirm that bearish case that EUR/USD has topped out at 1.4337 and should bring deeper decline through 1.3747 low towards channel support (now at 1.3446). On the upside, above 1.4137 will indicate that rise from 1.3747 is still in progress and should bring retest of 1.4337 high. But even in case of a break there, we'll continue to focus on reversal signal as EUR/USD meets medium term trend line resistance (now at 1.4413).

In the bigger picture, focus remains on whether EUR/USD has topped out at 1.4337. But in any case, as rise from 1.2456 is still treated as part of the medium term consolidation that started at 1.2329, it should be limited by 1.4719/4867 resistance zone. Hence, even in case of another rise, upside potential should be limited and focus will still be on reversal signal in case of another rise. On the downside, below 1.3826 will revive the case that EUR/USD has already topped. Further break of mentioned channel support (now at 1.3446) will confirm and bring deep decline targeting 1.2456/2884 support zone.

Subscribe to our daily and mid-day newsletter to get this report delivered to your mail box