EURUSD—pressure is on

The bearish pressure that followed the high of 1.3861 appears to still be exerting downward pressure with a drop to a low of 1.3432 so far this morning. There's a small head and shoulders on the daily chart (left shoulder was 1.3789; head was 1.3861; right shoulder was 1.3744). The confirmation level was 1.3509 and the target is 1.3157. Before it gets there, support is at 1.3396 and 1.3244/32 (strong support). Euro is within a larger downward channel and the lower boundary is 1.2607, right on a speed line as well. If the pair can't climb back and close above 1.35 today, the bears will have seized control and won't easily give it back.

Resistance is at 1.3498 and 1.3744. 1.40 seems a dream at this point.

I went short on Friday at 1.3535 based on the shorter-term charts.

Here's the daily chart:












© Dianne Fecteau, 2011. 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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