FX.co ★ Trading plan for EURUSD on May 02, 2023

Technical outlook:

EURUSD dropped to the 1.0964 low on Monday testing its previous 1-hour chart support around 1.0960. The single currency has pulled back since then and is seen to be trading close to 1.0985 as the bears prepare to come back in control soon. Ideally, prices should stay below the 1.1095 swing high carved over the last week.

EURUSD is poised to resume its last leg lower towards 1.0500 to complete the complex corrective wave, which had begun from 1.1035. The currency is targeting lower towards 1.0500, 1.0250 and down to 1.0100 to complete the retracement. Also, note that 1.0100 is the Fibonacci 0.619 retracement of the earlier rally between 0.9535 and 1.1035 levels, hence the strong support level.

EURUSD has further carved an Evening Star candlestick pattern on the daily chart, which is an indication of a reversal against the 1.1095 high. Intraday resistance is seen around the 1.1000-1.1010 zone. Therefore, watch out for a bearish turn if prices manage to reach there. Only a consistent break above 1.1100 will nullify the bearish outlook.

Trading idea:

A potential bearish drop against 1.1200

Good luck!