Technical Market Overview:

After the low at the level of 1.0998 had been made, the EUR/USD pair has bounced in order to break out from the Ending Diagonal pattern seen at the H4 timeframe chart. The market conditions are extremely oversold on this timeframe, but due to the weak and negative momentum that is still hovering below its fifty level, the odds for another leg down are still high. The next target for bulls, if the breakout is genuine, is seen at the level of 1.1040, but the real gamechanger is seen at the level of 1.1076. Please notice that the downside is limited by the lower channel line as well, so the support might help the price to move higher.

Weekly Pivot Points:

WR3 - 1.1171

WR2 - 1.1139

WR1 - 1.1072

Weekly Pivot - 1.1044

WS1 - 1.0977

WS2 - 1.0946

WS3 - 1.0872

Trading Recommendations:

Not much has changed since the last week in a bigger perspective. Still, the best strategy for current market conditions is to trade with the larger timeframe trend, which is down. All upward moves will be treated as local corrections in the downtrend. The downtrend is valid as long as it is terminated or the level of 1.1445 clearly violated. There is an Ending Diagonal price pattern visible on the larget timeframes that indicate a possible downtrend termination soon. The key short-term levels are technical support at the level of 1.1040 and the technical resistance at the level of 1.1267.