EUR/USD’s strong rally and break of 1.1807 confirms that rise from 1.1467 is resuming. Also, corrective pattern from 1.197 could have completed with three waves to 1.1576. Initial bias stays on the upside this week for retesting 1.1917. Firm break there will resume larger up trend. On the downside, below 1.1727 minor support will mix up the outlook and turn intraday bias neutral again.
In the bigger picture, as long as 55 W EMA (now at 1.1428) holds, up trend from 0.9534 (2022 low) is still in favor to continue. Decisive break of 1.2 key psychological level will carry larger bullish implication. However, sustained trading below 55 W EMA will argue that rise from 0.9534 has completed as a three wave corrective bounce, and keep long term outlook bearish.
In the long term picture, 38.2% retracement of 1.6039 to 0.9534 at 1.2019, which is close to 1.2000 psychological level is the key for the outlook. Rejection by this level will keep the multi decade down trend from 1.6039 (2008 high) intact, and keep outlook neutral at best. However, decisive break of 1.2000/19, will suggest long term bullish trend reversal, and target 61.8% retracement at 1.3554.
