It's impossible to know at this moment whether the overnight low of .9877, point E, has been reached in the triangle. It's not quite at support of .9850 so a bit further push down is possible. If .9877 was the low then it strengthens the case for an upside breakout. An upside breakout also makes sense within the context of the overall, larger trend. However, in the larger, weekly picture, there are bearish signals such as the bearish candles on the weekly chart from November and early January and the break of the daily uptrend line from June. A definitive break below the triangle would lead to the conclusion that the 1.0257 was part of a topping formation. However, there is still the unconfirmed double bottom in January (9804 and 9833 with the confirmation point at 1.0077) and a target of 1.0350.
So, still sideways for now with the key prices being 1.0022 (better 1.0070) or below .9850 and better .9804.
I don't think this will continue much longer. If price drops to .9855, monitor it carefully as that is the nearby support for the triangle's last leg down.
Support is at .9855, .9804, .9691, .9612 and .9544/32/15. If the pair gets above 1.0077, resistance is 1.0183, 1.0257, and 1.0300/50.
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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