The weekly close was below 1.60 at 1.5963 which is discouraging since last week's high was 1.6018. While I still believe the pair has more upside potential it's definitely stalling. You can see negative divergence on the daily chart. There's a small triangle forming on the three-hour chart which may provide a buying opportunity at 1.5839. Recent lows are 1.5827. Only if the pair dips below last week's 1.5749 would it hint the rally is failing and the larger downtrend is resuming.
I'm looking at this as a C wave in a correction. If C is .618 of A then the target is 1.6391. If it is to equal A then the target is 1.7067 but I'm not sure this is possible. There's strong price resistance from early in the year of 1.6244/98. The January high was 1.6461 which is near my daily bull flag target. I also have point and figure chart targets around the 1.66 area.
Here's the daily 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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