EUR/USD rose to 1.1496 last week but reversed from there. Current development suggests that rebound from 1.0777 has completed. Initial bias is mildly on the downside this week for retesting 1.0777 low first. But we’re not expecting a break there, at least not on first attempt. on the upside, above 1.1250 minor resistance will turn bias to the upside for 1.1496 resistance again.
In the bigger picture, rebound from 1.0777 low faced heavy rejection from 38.2% retracement of 1.2555 to 1.0777 at 1.1456, as well as 55 month EMA. The development argues that price actions from 1.0777 medium term pattern are just corrective the down trend from 1.2555 (2018 high). Further decline is in favor to retest 1.0339 (2017 low). Nevertheless, sustained break of 1.1456 will raise the chance of medium term bullish reversal and target 61.8% retracement at 1.1876.
In the long term picture, outlook remains bearish for now. EUR/USD is held below decade long trend line that started from 1.6039 (2008 high). It was also rejected by 38.2% retracement of 1.6039 to 1.0339 at 1.2516 before. A break of 1.0039 low will remain in favor as long as 55 month EMA (now at 1.1512) holds.
