Daily Pivots: (S1) 1.2086; (P) 1.2116; (R1) 1.2157; More

EUR/USD retreats notably after hitting 4 hour 55 EMA. But still, as a short term bottom should be formed at 1.2052, another rise remains mildly in favor. Rebound form 1.2052 would target a test on 1.2348 high. However, decisive break of 1.2058 cluster support (38.2% retracement of 1.1602 to 1.2348 at 1.2063) will pave the way to 61.8% retracement at 1.1887.

In the bigger picture, rise from 1.0635 is seen as the third leg of the pattern from 1.0339 (2017 low). Further rally could be seen to cluster resistance at 1.2555 next, (38.2% retracement of 1.6039 to 1.0339 at 1.2516). This will remain the favored case as long as 1.1602 support holds. We’d be alerted to topping sign around 1.2516/55. But sustained break there will carry long term bullish implications.

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