EURUSD close to a major bottom formation around 1.1200

EURUSD has carved yet another shallow low on Tuesday around 1.1226 before finding mild bids. The downside remains limited from here and the single currency pair might test 1.1200-10 mark before resuming higher again. A push through 1.1380 would be encouraging to bulls.

EURUSD is trading around 1.1240-45 mark at the time of writing and high probability remains for a bullish Morning Star pattern to be carved on the daily chart. It would indicate a potential bullish trend reversal toward 1.2350 going forward.

EURUSD’s wave count is also presenting a classic Elliott Wave pattern described as follows: The rally between 1.0636 and 1.2350 subdivided into five waves, carving an impulse Wave (1) on the chart here. Ideally, an impulse is followed by a corrective wave opposite the trend.

The drop between 1.2350 and 1.1226 unfolded as a corrective zigzag pattern 3-3-5, marked as Wave (2) on the chart here. If correct, EURUSD should be preparing to rally toward 1.2350 and higher in the next few weeks.

Traders might be inclined to initiate fresh long positions now (1.1240-45) with a risk below 1.1200 levels. Immediate potential targets are pointing toward 1.1700-10 mark.

Prepared by

The Profinacademy.com Team