FX.co ★ Short-term technical analysis on EURUSD for January 4th, 2023

Violet lines- Fibonacci retracements

EURUSD is trading above 1.06 after a bearish day yesterday. Price broke below the key 1.0570 support and made a low around 1.0520. Bulls stepped in and have managed to reclaim more than 50% of the decline. Price has almost reached the 61.8% retracement of the decline. Is this bounce just a counter trend move? The 61.8% Fibonacci retracement is important short-term resistance. As long as price is below this level bears have hopes for the creation of a lower high and the start of a new downward move. Of course the recent low at 1.0520 is critical support as a break below it would be a new bearish signal that could push price towards 1.03.