Technical outlook:

EURUSD has eased off from the 1.0786 highs registered early this week, hitting 1.0678 on Tuesday. The single currency pair is seen to be trading at around 1.0710 at this point in writing and is expected to continue lower towards 1.0610-20 in the near term. Bears will be inclined to hold prices below 1.0786 to keep the short-term structure intact.

EURUSD seems to have carved a lower degree upswing between 1.0350 and 1.0786. Further, bulls have taken out initial resistance in the 1.0640-50 area with ease. Ideally, a pullback should unfold through the 1.0520 mark, which is also the Fibonacci 0.618 retracement of the above upswing. The high probability remains for a bullish bounce around 1.0520.

EURUSD is working on a larger degree downswing between 1.2266 and 1.0350 as seen on the daily chart. The counter-trend rally is expected to unfold into three waves and potential targets are 1.1100 up to 1.1500 levels respectively. Also, note that 1.1500 is close to the Fibonacci 0.618 retracement of the above downswing hence vulnerable to a bearish move.

Trading plan:

Potential short-term drop to 1.0520, then rally through 1.0920 and 1.1500 against 1.0300

Good luck!