EUR/USD Mid-Day Outlook

Daily Pivots: (S1) 1.3867; (P) 1.3959; (R1) 1.4014; More

Intraday bias in EUR/USD remains on the downside for the moment. As mentioned before, choppy corrective rise from 1.3747 has completed at 1.4196 already and fall from 1.4337 is likely resuming. Below 1.3747 support will confirm this case and target medium term channel support (now at 1.3540). On the upside, though, break of 1.4049 will dampen this view and turn short term outlook mixed first.

In the bigger picture, as mentioned before, rise from 1.2456 is treated as the third leg of medium term triangle consolidation from 1.2329 (first leg completed at 1.4719, second at 1.2456). With daily MACD staying below signal line, it's likely that such rise has completed at 1.4337 already. Break of 1.3747 will add more credence to this case and firm break of channel support (now at 1.3540) will confirm and bring deeper fall 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, above 1.4337 will delay the bearish case and indicate that rise from 1.2456 is still in progress. Nevertheless, as this rise is still treated as part of the medium term consolidation, it should be limited by 1.4719/4867 resistance zone. Hence, upside potential should be limited and focus will still be on reversal signal even in case of another rise.

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