Wednesday, January 26, 2011

EUR/USD and EURO crosses ready for pullback

EUR/USD Current Price: 1.3686 Daily Pivots:
S3: 1.3439; S2: 1.3520; S1: 1.3601; P: 1.3653; R1: 1.3734; R2: 1.3786;
R3: 1.3838

*EUR/USD:* Price action on the EUR/USD for the last two weeks has been
up. This is consistent with a move up in most of the EURO crosses:
EUR/GBP, EUR/JPY, EUR/AUD and EUR/CAD. If we look at each cross
individually, we see that all are trading at the upper end of the
Bollinger band with oscillator resistance. On the EUR/USD, while we
have not seen a reversal candlestick pattern emerge on the daily chart
yet, once we do, we should see a sell-off. In the mean time, when we
measure the FIB retracement of the last swing move down from 1.4283 on
November 4th to 1.2859 on January 10th, we are approaching the 61.8%
level at 1.3740. A breach of that level will target the 76.4%
retracement at 1.3945 which is also close to the 1.4000 psychological
barrier. Since the EUR/USD is stretched on the upside, along with the
previously mentioned EURO crosses, it seems likely that upside is
extremely limited without some kind of a pullback. On the downside,
watch the 1.3500 major support level. A sustained drop below that
level will signal a reversal.

If you are an advanced Forex trader and would like to learn Elliott
Wave analysis, please contact me. If you are interested in signing up
for a FREE 60-minute Starter Session, to assess where you are in your
trading, please send an email to jody@fxtradersedge.com. Happy
Trading!
Source: Fxstreet.com

No comments: