I’m bearish at current levels as price has reached important daily resistance by the Ichimoku cloud and there are increased chances of a pull back towards 1.08. Important daily support is at 1.0785. A break below that level will open the way for a move towards the December lows.
EURUSD has short-term resistance the 1.0980 level and next at 1.1060. Breaking above these levels will open the way for a bigger bounce towards 1.12-1.13.
Huge support is found at 120.70. Price is trading inside a triangle pattern and is testing the daily Ichimoku cloud support. There are a lot of chances of seeing a big bounce from current levels but traders should not forget to use stops as a break below support will open the way for a push towards August lows.
Price remains inside a long-term downward sloping wedge and with price very close to the lower boundary, combined with oversold oscillators, I would be looking closely to enter long positions.
With short-term support at 1.4870, a break below that level will push price towards 1.4840 but I believe the downside is limited now and we should focus on long position trades. Short-term resistance at 1.4920 will be an initial reversal signal.
Last Friday I mentioned in my analysis that I would be bullish around 0.71 expecting a bounce towards the cloud resistance and possibly higher. However with the stochastic oscillator overbought and price hitting the red trend line resistance, I will give the short side a chance as we could very well get rejected at the Ichimoku cloud.
I would normally expect the reversal to get confirmed if we break below 0.72 with target 0.71. In general I expect some Dollar strength across the board.