EUR/USD’s strong rebound last week argues that a medium term bottom could be in place at 1.1120, on bullish convergence condition in daily MACD. Initial bias stays on the upside this week. Break of 1.1482 resistance will target 38.2% retracement of 1.2348 to 1.1120 at 1.1589 next. Sustained break there will argue that whole fall from 1.2348 has completed too and target 61.8% retracement at 1.1879. On the downside, break of 1.1329 minor support will mix up the outlook and turn intraday bias neutral first.
In the bigger picture, the decline from 1.2348 (2021 high) is seen as a leg inside the range pattern from 1.2555 (2018 high). Sustained trading above 55 week EMA (now at 1.1613) will argue that it has completed and stronger rise would be seen back towards top of the range between 1.2348 and 1.2555. However, firm break of 1.0635 (2020 low) will raise the chance of long term down trend resumption and target a retest on 1.0339 (2017 low) next.
In the long term picture, in another case, as long as (38.2% retracement of 1.6039 (2008 high) to 1.0339 (2017 low) at 1.2516 holds, the down trend from 1.6039 could still resume through 1.0339 low. However, sustained trading above 1.2516 will argue that the long term trend has reversed.
