EURUSD prepares for counter trend rally towards 1.2050

Technical Analysis:

EURUSD might have found interim support around 1.1760/65 levels over the last week and bulls might be preparing to produce a counter-trend rally or retracement towards 1.2050 levels soon. It might provide yet another opportunity to initiate short positions.
EURO faces strong resistance at 1.2242 mark; while intermediate support is seen around 1.1750 levels respectively. The currency has managed to rally through 1.1800 highs after carving lows around 1.1765 levels over the last week.
Also note that RSI on different time frames has been producing bullish divergences, which might be indicating a potential bullish reversal ahead. The fibonacci 0.618 retracement also passes through 1.2050 levels, which is potential resistance.
A push through 1.1810 levels from here on would confirm that bulls are back in control and they remain poised to push through 1.2050 mark. The past support turned resistance zone starts from 1.1950 and spreads through 1.2050 levels respectively.
EURUSD might also find resistance around 1.1950 levels and resume lower towards 1.1600 levels, going forward. We remain prepared to initiate partial shorts around 1.1950 and remaining if prices reach 1.2050 mark respectively.
The above bearish structure will change only on a break above 1.2242 resistance. Until that, EURUSD remains a good candidate to be sold on rallies through 1.2050 levels.

Prepared by

Finacademy Technical Team