Technical Outlook:

EURUSD wave structure continues to remain bullish as it carves a potential higher low around 1.1167 levels. Bulls would be looking to push towards 1.1500 resistance to confirm a long term trend reversal. EURUSD trades above 1.1200 handle as we prepare the article but we still need to see a break above 1.1250 to confirm a bottom at 1.1167.

Structurally, EURUSD might be unfolding Wave 3 higher since 1.0775 lows. Ideally, prices should stay above 1.1000 to keep the impulse structure intact for Wave 3. Earlier, the currency had rallied from 1.0636 through 1.1150 terminating Wave 1.

The corrective drop Wave 2 had unfolded as a triangle structure a-b-c-d-e, terminating at 1.0775. Since then, Wave 3 has been progressing and is expected to terminate around 1.1500 handle. Please note, a break above 1.1500 would confirm a long term bullish reversal in the EURO.

Looking at the lower degree waves within Wave 3, a potential wave iv has been unfolding since 1.1400 highs. It has dropped close to fibonacci 0.618 retracement of wave iii around 1.1167 today, before reversing higher again. Ideally, EURUSD is expected to stay above 1.1167 lows going forward.

Immediate short term resistance is seen towards 1.1250/60, while interim support is seen at 1.1167 levels respectively. A break above 1.1250 would be encouraging for bulls, and also confirm a meaningful bottom in place at 1.1167 handle.

EURUSD still remains in control of bulls, and a candidate to buy on dips with potential targets above 1.1500 handle.



Trading Strategy:

Long against 1.0630, targeting 1.1500



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