FX.co ★ Trading plan for EURUSD on December 23, 2022

Technical outlook:

EURUSD dropped to the 1.0573 low during the New York session on Thursday before finding bids again. The single currency pair is seen to be trading around 1.0605 at this point in writing as the bears prepare for a breakout. The currency pair has remained sideways for the most part of the week and a clear break below 1.0560 would confirm a breakout. Interim resistance stays at 1.0736 keeping the bearish outlook intact for now.

EURUSD turned lower from 1.0736 over the last week carving an Engulfing Bearish candlestick pattern right at the trend line resistance as seen on the daily chart. Prices might rally through the 1.0670-80 zone, which is the near-term resistance, before turning lower towards the larger-degree trend. The bears are keen to take advantage until prices stay below 1.0736.

EURUSD might have terminated its counter-trend rally, which began from 0.9535 around the 1.0736 highs last week. If the above holds well, prices would stay below 1.0736 and reverse lower towards 0.9535 and further in the next few weeks. On the flip side, if 0.9535 is a major bottom carved, prices should find support around the 1.0100-50 area. The bias is looking lower in the near term.

Trading idea:

A potential drop against 1.0750

Good luck!