EUR/USD Mid-Day Outlook

Daily Pivots: (S1) 1.4346; (P) 1.4373; (R1) 1.4410; More

EUR/USD's fall from 1.4578 resumes after brief recovery and dives to as low as 1.4263 so far. As discussed before, consolidation from 1.4217 should have completed at 1.4578 already after hitting 38.2% retracement of 1.5143 to 1.4217. Intraday bias remains on the downside for the moment and firm break of 1.4256 support will suggest that whole fall from 1.5143 is resuming. In such case, EUR/USD should target 38.2% retracement of 1.2329 to 1.5143 at 1.4068 next. On the upside, though, above 1.4413 minor resistance will turn intraday bias neutral again and suggest that more consolidation would be seen before fall resumption.

In the bigger picture, medium term rise from 1.2456 has completed at 1.5143 on bearish divergence conditions in daily MACD. Focus now turns to 1.3737 cluster support (50% retracement of 1.2329 to 1.5143 at 1.3736). Decisive break there will also confirm the case that three wave consolidation from 1.2329 has finished at 1.5134 too. In other words, whole medium term term fall from 1.6039 should be resuming for a new low below 1.2329. On the upside, above 1.5143 resistance is needed to invalidate this view. Otherwise, outlook will now remain bearish.

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