EUR/USD’s fall from 1.1239 extends to as low as 1.1020 last week. The development affirmed our view that corrective rise from 1.1179 has completed with three waves to 1.1239. Initial bias stays on the downside for 1.0981 support first. Break will confirm and target a retest on 1.0879 low. On the upside, above 1.1070 minor resistance will turn intraday bias neutral first. But risk will stay on the downside as long as 1.1172 resistance holds.
In the bigger picture, rebound from 1.0879 is seen as a corrective move at this point. In case of another rise, upside should be limited by 38.2% retracement of 1.2555 to 1.0879 at 1.1519. And, down trend from 1.2555 (2018 high) would resume at a later stage. However, sustained break of 1.1519 will dampen this bearish view and bring stronger rise to 61.8% retracement at 1.1915 next.
In the long term picture, outlook remains bearish for now. EUR/USD is held below decade long trend line that started from 1.6039 (2008 high). It was also rejected by 38.2% retracement of 1.6039 to 1.0339 at 1.2516 before. A break of 1.0039 low will remain in favor as long as 55 month EMA (now at 1.1538) holds.
