Today's Support and Resistance levels:

R3: 1.6715

R2: 1.6675

R1: 1.6654

Current spot: 1.6649

S1: 1.6620

S2: 1.6510

S3: 1.6578

Technical overview:

Yesterday we saw an attempted to break above important resistance at 1.6756 (the high came in at 1.6762), but it failed and caused a deeper than expected decline to 1.6558. The decline below 1.6582 has forced us to change our short-term count slightly. With the break below 1.6582 it was confirmed, that we still was in red wave ii. Red wave ii is an expanded flat correction and that means we will be looking for an extended red wave iii once it is confirmed, that red wave ii is over. We do think we saw the bottom of red wave ii at 1.6558 and red wave iii higher has begun, but we need a break above 1.6715 and, more importantly, a break above 1.6762 to confirm that red wave iii is developing for a rally towards 1.7490. In the short term we are looking towards 1.6675 followed by a correction, which ideally will find support at 1.6632, but could take us lower to 1.6603 before the next rally higher.

Trading recommendation:

Our stop at 1.6575 was taken out for a nice profit. However, we are looking for a new opportunity to buy EUR and will buy at 1.6610 with a stop at 1.6550.