Weekly Report 17-21/ 10/ 2011
The pair is stable below the bottom of point (c), which could support a retest of 127.2% Fibonacci correction of the CD leg at 1.0005, but also the downside movement could extend towards the last extended target of the bearish harmonic pattern as shown above, which is located at 161.8% Fibonacci of the CD leg at 0.9825. The descending channel's main resistance resides with the Exponential Moving Average 20, which supports the suggested downside movement and also weakens the effect of Stochastic being within oversold areas. Consolidation above 1.0255 with 4-hour closing is sufficient to negate our expectations over intraday basis.
The trading range for this week is among the major support at 0.9825 and the major resistance at 1.0400.
The short-term trend is to the downside as far as 1.0665 remains intact targeting 0.9000.
|Recommendation||Based on the charts and explanations above, we recommend selling the pair around 1.0115, and take profit in stages at (1.0000 and 0.9825) and stop loss with 4-hour closing above 1.0205 might be appropriate this week.|