Monday, 10th of Oct, 2011
WEEKLY TECHNICAL STRATEGIST
EURUSD: Halts Declines, Recovery Risk Develops.
EURUSD: The pair has halted its weakness following a failed test of the 1.3144 level the past week. With a high wave candle pattern now in place, risk of a recovery higher in the new week is a possibility. In such a case, its Friday high at 1.3524 level will come in as the initial resistance with a violation of that level creating scope for a move lower towards its Sept 28’2011 high at 1.3690. We may see a price hesitation turning EUR lower at this level but if that fails to occur, further strength could build up towards the 1.3799 level, its Sept’2011 high and the 1.3835 level. On the downside, the risk is for the pair to return below the 1.3144 level annulling its corrective attempt and then targeting the 1.3000 level, its big psycho level. Price hesitation ahead of or at this level could occur and turn the pair back up but if taken out, further weakness should shape up towards the 1.2875. All in all, EUR may have halted its weakness the past week but remains susceptible to the downside.
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