28th September to 2th October 2009 Euro / USD
Posted by admin | Posted in Weekly and Daily Wake up | Posted on 28-09-2009
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Before going over edge with a sharp turn EUR/USD last week increased beyond 1.4842. However, reversal was in continuation along with bearish divergent situation during 4 hours MACD but this cannot be confirmed in exact manner as 1.4611 support is still intact. All the same time the other rise cannot be ignored completely and there is likely to be the loss of momentum upside and indication of reversal signals as EUR/USD nears the resistance of 1.4867 key. At the downside, the break of 1.4611 support will indicate that a short term top of the pair is formed at least which will act as a catalyst to the deeper fall to resistance 1.4446 which however turned to support.
In the larger picture frame, increase from key 1.2456 is in fact a third leg in the consolidation pattern which actually begun at 1.2329. This will get closed at the completion of the consolidation pattern in the form of fifth wave of the five wave sequence pattern beginning from 1.2456. It is very much expected that this rise will get limited by resistance of 1.4867 key. If 1.4177 support will break, then this will be an indication that EUR/USD has topped the ranks. This will be confirmed with the break of 1.3747 support. In such scenario, a further decline which will send pair of EUR/USD by 1.2329 low.
In a long term picture frame, price actions which begun at 1.2329 will be treated as the consolidation in larger down trend. So, it is assumed that fall of EUR/USD pair from 1.609 will be resumed once the consolidation gets completed. If pair goes below than 1.2329, then this will be served as the confirmation that this down trend has somehow resumed a test on key 1.1639 as a long term support.
We have to hold on to such long term bearish view till the resistance at 1.4867 holds. However, this long term bearish view will get suppressed with the right break at 1.4867. This will in turn trigger a more potent rise which may put a retest on key 1.6039.
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