Technical outlook:
EURUSD has achieved and surpassed its first fibonacci extension at 1.1795 levels, highlighted here on the daily chart since last several weeks. It would be interesting to see if it continues to drop from here towards the second target below 1.1700 levels or after producing a meaningful corrective rally. The RSI has been showing bullish divergences already on smaller time frames and a pullback cannot be ruled out.
The single currency pair is seen to be struggling just below 1.1790 levels at this point in writing as bulls remain poised to hold above 1.1760 lows. If successful, bulls might be able to produce a swift counter trend rally straight towards 1.2050 levels, which is fibonacci 0.618 retracement of the recent drop between 1.2242 and 1.1760 lows respectively.
In the near term, EURUSD should be possibly trading below 1.1600 lows, a major support since November 04, 2020. It would also open doors for a potential head and shoulder trend reversal towards 1.1200/1.1300 and further. A break below the one year old trend line support would be seen as encouraging to bears. We continue to remain bearish below 1.2350.
Trading plan:
Remain short, stop @ 1.2350, target @ 1.1600
Good luck!
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