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16.05.202207:45 Forex Analysis & Reviews: Trading plan for EURUSD on May 16, 2022

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Technical outlook:

EURUSD dropped through the 1.0348 low on Friday during the New York Session before finding support again. The single currency pair is seen to be trading close to 1.0405 at this point in writing and might have carved a meaningful bottom last week. Bulls are now looking poised to remain in control and push through the 1.0641 initial resistance.

EURUSD has interim support around 1.0300 while resistance is seen through 1.0641, followed by 1.0920-30, 1.1200 and higher respectively. A break above 1.0640 will confirm a meaningful bottom is in place and that bulls are back in control. The potential remains for a push through 1.1200 levels going forward.

Furthermore, also note that each low printed after 1.0800-10 has been accompanied by a bullish divergence on the daily RSI as shown here. There is a strong potential for a trend reversal in the next few sessions as bulls prepare to take out the 1.0640 mark. Traders might be preparing to initiate fresh long positions with risk below the 1.0300 mark.

Trading plan:

Potential rally towards 1.0640 and 1.0930 against 1.0300

Good luck!

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