EURUSD has dropped through 1.1612 levels last week. The currency continues to remain in control of bears after hitting 1.2010 highs on September 01, 2020. Short term resistance is seen towards 1.1780/1.1800 handle and it is expected to resume lower from there.
EURUSD was successful in producing a meticulous rally between 1.0636 and 1.2010 in the past several weeks. The rally was clearly sub divided into 5 waves, making an impulse at a larger degree. Under ideal conditions, we should witness a corrective drop towards 1.1100 levels.
Please note that fibonacci 0.618 retracement of the above rally falls around 1.1150/60 mark, which remains high probable bullish bounce zone. The entire structure is not seen on the above chart but it is expected to unfold accordingly in the next several weeks.
EURUSD short term wave structure is also looking encouraging for bears. The initial drop from 1.2010 through 1.1754 could be lower degree Wave 1 (not labelled here). The subsequent sideways price action might have terminated Wave 2 around 1.1915 levels.
Also note that 1.1915 is the fibonacci 0.618 retracement of Wave 1 and an ideal place for bears to have taken control. Going further, Wave 3 might be unfolding since 1.1915 mark, and could be near to completion.
If the above structure holds true, EURUSD might be underway to produce a meaningful drop towards 1.1500 in the near term to complete an impulse drop from 1.2010 levels.
Technical Analysis Team
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