EURUSD - Mild correction expected to precede fresh push lower

Slobodan Drvenica Windsor Brokers

EURUSD

The Euro started week positively and bounced above 1.06 barrier, following ten straight days in red that hit fresh nearly one-year low at 1.0567 on Friday.
The pair remains widely offered and mild recovery attempts are seen ahead of final attack at key supports at 1.0519 and 1.0461 (Dec / Mar 2015 lows).
Hourly Ichimoku cloud (spanned between 1.0633 and 1.0667) marks initial barrier that so far caped rallies (despite brief penetration into cloud).
Upticks should be ideally limited by hourly cloud, before strong bears resume. However, risk of extended correction exists, as stronger bounce on pre-holiday profit-taking cannot be ruled out. The notion finds support in oversold daily studies, but without clearer reversal signals for now.
Sustained break above hourly cloud would signal extended upticks that may stretch towards 1.0740 / 66 (Fibo 23.6% of 1.1298/1.0567 fall / falling 10 SMA). Only rally above 1.0849 (former low of 25 Oct / Fibo 38.2% retracement) would generate stronger bullish signal.

Res: 1.0648; 1.0667; 1.0700; 1.0740

Sup: 1.0567; 1.0519; 1.0500; 1.0461

Interested in EUR/USD technicals? Check out the key levels

1. R3 1.0621
2. R2 1.0611
3. R1 1.0597
PP 1.0588
1. S1 1.0574
2. S2 1.0565
3. S3 1.0551

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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