Technical outlook:

EURUSD rallied through the 1.0586 high intraday on Friday, just a few pips shy from its recent swing high at 1.0595. A bearish reversal from here will confirm that a lower top is in place and that the bears are back in control. The single currency pair is seen to be trading around 1.0574 at this point in writing as the bears aim to break below 1.0420 in the near term.

On the flip side, if prices break above 1.0595, this price action could open the door to test up to the 1.0700-50 high before giving in to the bears again. Looking at the wave structure, the larger-degree corrective wave, which had begun from 0.9535 earlier, looks mature. It is just a matter of time when the bears enter the market and drag prices lower towards 1.0000 at least.

EURUSD is facing immediate resistance at 1.0595, followed by 1.0700-50; while support comes in around 1.0420, followed by 1.0220 and lower respectively. A break below 1.0420 or above 1.0585 will be now required to gauge the next big move. A higher probability remains for the bears to be back in control sooner than later.

Trading idea:

Potential bearish reversal against 1.0700

Good luck!