Technicals

The euro fell sharply from todays high 1.5970 to 1.5840. There was a possibility this move to be an impulse but it is no more likely after current rebound. It is clear now that the fall shown on the chart is corrective in nature and is probably wave A of a flat correction. In such a case we are currently in wave B with minimum requirement 1.5920 (61.8 % retracement of wave A). I would expect thereafter one more fall in wave C for a low below 1.5840.

I entered today a risky short position because there was a possibility for a sell-off but now I will look for an exit level for my main position. I will leave the target open at the moment and will determine it later when there is more clearness how deep will be the expected fall below 1.5840. A key resistance is 1.5970 and in a case of a break above it, a retest of 1.6018 high is inevitable

Trading strategy: 11:17 EST; 16:17 GMT

Short position from 1.5896, stop loss - 1.6025, target - open

Addition to the short position from 1.5870 was closed at 1.5915 with loss 45 pips

Confidence level changed from medium to low