Daily Pivots: (S1) 1.1712; (P) 1.1755; (R1) 1.1785; More…..
EUR/USD’s decline and break of 1.1723 minor support is the first signal that corrective rise from 1.1300 has completed. That came after meeting strong resistance from 38.2% retracement of 1.2555 to 1.1300 at 1.1779 as we expected. Intraday bias is turned back to the downside for 1.1525 support first. Break will confirm this bearish case and target a test on 1.1300 low. On the upside, again, sustained break of 1.1779 will dampen our view and extend the rise from 1.1300.
In the bigger picture, a medium term bottom should be in place at 1.1300, on bullish convergence condition in daily MACD and some consolidations would be seen. But still, note that EUR/USD was rejected by 38.2% retracement of 1.6039 (2008 high) to 1.0339 (2017 low) at 1.2516. That carries some long term bearish implications. Thus, we’d expect fall from 1.2555 high to resume after consolidation completes. Below 1.1300 should send EUR/USD through 61.8% retracement of 1.0339 to 1.2555 at 1.1186. And, in that case, EUR/USD would head to retest 1.0339 (2017 low).
