Chart of the day

EURUSD is going for a retest of a previously broken downside resistance of 1.06500. A rejection here will lead to a downside continuation in the third wave of the downside five short-term.

This is still viewed as the long-term five-wave downside and to invalidate the extension lower and to completely reverse higher we need to see a break above 1.07000.

Short trades are favored to be opened here with a stop loss above 1.07000 and you can trade with options as well. We favor the short trade entries at this stage as we see an ongoing price action to continue lower after the broken downside resistance retest. Long trade entries could come only upon a confirmed break above 1.07000.