With the drop to 1.2989 this morning, Euro is getting uncomfortably close to the 1.2952 area below which will bring out even more sellers. Note that on the three-hour chart below, RSI isn't plunging into oversold (nor has it been) meaning that even though its bullish momentum has abated it there isn't a rush to sell. The pair is currently at a support level. Be careful with the lack of liquidity in August markets.
Still, as I wrote yesterday, Friday's spike up to 1.3335 may have been it for the Euro, completing the wave C correction. The bounce yesterday to 1.3226 was close to the 7/13 uptrend line and so it may have served as a retest of resistance before heading lower. Definitely a pair that deserves watching.
Support is at 1.2989, 1.2950, 1.2898/78 and 1.2811(100 daily SMA). Resistance is 1.3000, 1.3050, 1.3125, 1.3226, 1.3335, 1.3433 and 1.3525 (50% retracement of wave one down from November highs).
Here's the three-hour chart:
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
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