Today's Support and Resistance levels:

R3: 1.6648

R2: 1.6590

R1: 1.6537

Current spot: 1.6485

S1: 1.6465

S2: 1.6447

S3: 1.6388

Technical overview:

With a low at 163.88 (just 11 pips below our ideal target at 1.6399) we have most likely seen the bottom of wave iv and should now see wave v higher. We still need a break above important resistance at 1.6590, but a break above here will confirm the bottom is in place at 1.6388 and call for a rally higher towards 1.7640 as the ideal target for wave v. In the short term we would like to see support at 1.6465 protecting the downside for the break above 1.6590, but we must allow for a move all the way down to 1.6388 before the next rally higher. However, support at 1.6388 cannot be broken with even a single pip as that would invalidate our bullish scenario.

Trading recommendation:

We took profit on our EUR short-position at 1.6450 and at the same time we reversed the position into a long EUR-position and we will place our stop at 1.6380. If you are not long EUR already, then buy close to 1.6465 or upon a break above 1.6590 with a stop at 1.6380.