Blue lines- Fibonacci retracement levels
EURUSD is trading above 1.12. Price has so far retraced almost 61.8% of the entire decline since 1.2348. The 61.8% Fibonacci retracement is at 1.1261 and this is important technical resistance. We usually see trend reversals at the 61.8% retracement level. So traders need to be very cautious as we approach this level. Technically trend remains bullish as price continues making higher highs and higher lows. The week is ending with price at its highest and usually after such candlesticks we see a quiet sideways movement with low volatility. The RSI is approaching oversold levels but clearly forming a new higher high suggesting that this up trend is still strong. Previous highs around 1.1030 are now short-term support. We might see a pull back towards that area but as long as we trade above 1.1030, we remain optimistic that EURUSD could reach and test the 78.6% Fibonacci retracement at 1.1750. First bulls will need to capture the 61.8% retracement at 1.1261.