FX.co ★ Trading plan for EURUSD for May 06, 2021

Technical outlook:

EURUSD finally resumes its counter trend rally, in line with our discussions yesterday, after carving a bottom at 1.1987 levels. Please note that potential for this correction remains through 1.2070 levels at least and up to 1.2090/1.2100 levels before finding resistance again. Bears might be preparing to take control back either today or tomorrow as the correction peaks.

EURUSD has raised through 1.2046 levels at this point in writing and has also hit interim resistance around fibonacci 0.382 retracement of the drop between 1.2150 and 1.1987 levels respectively (not shown here). Immediate price resistance is seen at 1.2150; while support comes in around 1.1987 levels respectively.

EURUSD should ideally complete the short-term corrective rally into 3 waves. It might have completed its first wave today around 1.2050 mark and would retrace a bit lower before resuming the third wave higher towards 1.2070/90 zone. The overall trend continues to remain down until prices stay below 1.2250 and broadly below 1.2350 levels respectively.

Trading plan:

Remain short, add more @ 1.2050 and 1.2070, stop @ 1.2050, target @ 1.1300

Good luck!