Technical outlook:
EUR/USD dropped to the 1.1742 low early today, confirming the medium term trend to remain downward. As we have been discussing over the past several week, the tarfget will remain at 1.1300, until the pair approaches the support level. The question remains for the short-term trading approach as counter trend rally is still possible.
EUR/USD is seen to be trading around the 1.1753 level. We prepared to publish today's update, including the information that bulls might remain poised to take control back soon. Immediate support zone is seen around 1.1720 while resistance stays around 1.1900/10. The euro might retrace its entire drop between 1.2266 and 1.1750 from here and move to the 1.2050/60 levels in the next few weeks.
EUR/USD might be still working on a larger wave structure that had begun from 1.2350 earlier and dragging lower towards 1.1300. It would be interesting to see whether the prices will continue dropping lower from here or produce a meaningful pullback rally. The Fibonacci 0.618 retracement of the recent drop is seen towards 1.2050/60, which is a potential turning point.
Trading plan:
Short term: Favor long positions, stop is below 1.1700, target is at 1.2050
Medium term: Favor short positions, stop is above 1.2266, potential target is at 1.1300
Good luck!