EURUSD is most likely preparing to rally towards 1.1750, 1.1850 and higher as potential wave iii begins to unfold. The single currency had dropped through 1.1585 mark on Tuesday before finding support again. Bulls are looking to be back in control from here.
EURUSD had rallied through 1.2350 highs on January 6, carving a larger degree impulse rally between 1.0636 and 1.2350 levels. As discussed earlier, an impulse wave is usually followed by a correction in the opposite direction.
Since 1.2350, EURUSD has carved a corrective drop marked as (A)-(B)-(C) on the daily chart here. Also note that the single currency found support around 1.1524 mark, just below the Elliott Channel. Further, the fibonacci 0.50 retracement of earlier rally was also seen passing close to 1.1500 mark.
High probability remains for a rally to materialize toward 1.1750 and higher from here. EURUSD needs to stay above 1.1524, for the above bullish structure to remain intact and valid. If prices drop below 1.1524, the next potential support comes in around 1.1450 mark.
Traders might be preparing to initiate fresh long positions from here (1.1600 levels), with protective stop below 1.1500 and target above 1.1950 in the next few weeks.
Prepared by
The Profinacademy.com Team
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