EUR/USD rebounds from support as traders watch key resistance

Gregor Horvat Wavetraders

After slow price action on EURUSD between the 1.17 and 1.18 levels, we are now seeing more serious weakness as US yields continue to move higher, so there is clearly some bearish pressure building for the euro, especially if we consider that the market already overlapped the 1.1633 level that we highlighted before. Usually, this suggests that the recovery from the March lows unfolded in three waves and that the bearish trend may be returning. If we see a break below the potential base channel and later also below the corrective channel near 1.1550, then the odds would increase for a continuation back towards the March lows at 1.1412. If we get some new fresh rebound, then we are likely in a triangle here.

Also, when looking at the daily chart and this current reversal lower towards 1.1630, it makes us think that sooner or later a higher degree wave C could appear and bring the pair back towards the 1.1300 to 1.12 area shown on the updated wave structure.

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Author

Gregor Horvat

Wavetraders

Experience Grega is based in Slovenia and has been in the Forex market since 2003.

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