EUR/USD rose further to 1.3106 last week but faced strong resistance from mentioned cluster level of 1.3105/3123 (38.2% retracement of 1.5143 to 1.1875 at 1.3123, 161.8% projection of 1.1875 to 1.2466 from 1.2149 at 1.3105) and turned sideway. Initial bias remains neutral this week and we'll continue to focus on reversal signals. Break of 1.2968 minor support will flip intraday bias back to the downside and further break of 1.2731 will argue that EUR/USD has topped out already. However, note that sustained trading above 1.3105/3123 will dampen our view and pave the way for stronger rise.

In the bigger picture, while a medium term bottom is in place at 1.1875, there is no indication of trend reversal yet. Rise from 1.1875 is viewed as a correction, or part of consolidation in the larger decline only. Whole fall from 1.6039 is still expected to continue and break of 1.2149/2466 support zone will indicate that such down trend is resuming for 1.1639 support and below. However, considering bullish convergence condition in weekly MACD, decisive break of mentioned 1.3105/3123 cluster level will argue that whole fall from 1.6039 might have finished totally at 1.1875 and will turn focus to 55 weeks EMA (now at 1.3455) for more evidence.

In the long term picture, considering the five wave impulsive structure of the long term up trend from 2000 low of 0.8223 to 2008 high of 1.6039, price actions from 1.6039 are viewed as a correction only. Hence, we'd expect strong support between 61.8% retracement of 0.8223 to 1.6039 at 1.1209 and 1.1639 support to contain downside and bring another long term up trend. However, note that sustained break of 1.1209 key fibonacci level will dampen this view and open up the case of a take on parity.

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