Weekly Report (May 09-13, 2011)

Despite last week's closing above the downside channel's resistance, trading is biased negatively to pressure the pair back to the downside, especially after finding strong resistance at 50% Fibonacci and the negative pressure from momentum indicators. Those facts support the bearishness, yet we have a possible bullish pattern formation with the proposed neckline at 0.9710 and accordingly we remain neutral and observe the pair around the critical neckline areas and the support at 0.9525 which if breached will negate the effect of the proposed bullish pattern.

The trading range for this week is among the major support at 0.9350 and the major resistance at 0.9845.

The short term trend is to the downside as far as 1.0665 remains intact targeting 0.9000.

RecommendationBased on the charts and explanations above we remain neutral and recommend observing the pair around the mentioned areas for more confirmations