The EURUSD has another bearish week, bottomed at 1.4260 yesterday. My bearish target at 1.4250 is considered reached. Although technical view remains bearish and I don’t see any significant bullish correction signal so far, I think it’s time to think about the possibility of an upside correction in the upcoming week. Always look at both sides of the story.
On my weekly chart below, price has been bearish in the last three weeks after failed to break above 1.5143 area and now seems ready to test the 38.2% Fibonacci retracement of 1.2456 – 1.5143 around 1.4127 area. Although the bearish momentum is strong, actually from broader point of view since Euro rally from 1.2456 on March, the bullish scenario remains intact and a pullback towards 38.2% level is considered a “normal” downside correction. The bullish scenario in this long term view is considered under a serious threat only by a break below 38.2% level around 1.4127 area targeting 1.3808 area (50% Fibonacci retracement). That’s why next week is going to be very interesting as the current bearish momentum will be tested seriously. A movement back above 23.6% Fibonacci retracement level around 1.4511 area could be considered as potential end to the bearish correction and might continue the bullish scenario.
Have a great weekend and see you guys next week