EUR/USD Mid-Day Outlook

Daily Pivots: (S1) 1.1519; (P) 1.1584; (R1) 1.1619; More…..

EUR/USD breached 1.1529 support but quickly recovered. Intraday bias remains neutral first. Outlook is unchanged that rebound from 1.1300 is viewed as a correction. In case of further rise, strong resistance should be seen at 38.2% retracement of 1.2555 to 1.1300 at 1.1779 to limit upside, at least on first attempt. On the downside, firm break of 1.1529 will indicate completion of the rebound and turn bias to the downside for retesting 1.1300 low. Overall, price actions from 1.1300 are forming a corrective pattern, that could extend for a while before completion.

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).