Technical outlook:

EURUSD dropped through the 1.0505 intraday lows during the Asian session on Monday, before finding support. The single currency pair is seen to be trading close to 1.0560 at this point in writing as the bears prepare to drag further towards 1.0000 at least. The price has reached the resistance zone and the probability remains for a turn lower from here or the 1.0700-50 area.

EURUSD has either completed or is close to terminating its three-wave corrective rally, which had begun from 0.9535 earlier. Also, note that prices have managed to reach the Fibonacci 0.382 retracement of a downswing between 1.2266 and 0.9535. If the above holds well, prices might turn lower and drag below 0.9535 in the next several weeks.

Alternatively, if a major bottom is already in place at 0.9735, prices might find support from around 1.0000 levels and turn higher again. Either way, the currency pair is likely to decline by almost 500 pips before finding support again. Most traders might be preparing to take advantage of a pullback lower from here. Watch out for strong resistance around 1.0750 going forward.

Trading idea:

A potential bearish drop against 1.0700

Good luck!