FXstreet.com (Barcelona) - The Euro extended yesterday its decline from 1.5130 area on early December, to a fresh 6-month low at 1.3935, and according to Peter Rosentreich, technical analyst at ACM - Advanced Currency Markets, showing signs of bottoming, which could anticipate a recovery to 1.4540 area.
Despite the bearish outlook on the medium-term, Peter Rosentreich warns about signs of bottoming on the pair: While there is the risk that the pair hugs the lower trend line to lower prices, there is every conceivable type of divergence as well as a series of candlesticks that are frequently seen at bottoms. At this point, not only would I make sure all short profits are off the table, I would also be tempted into the long side despite my bearish macro outlook for the medium term.
On the upside, Rosenstreich observes the possibility of a retracement to 1.4540 region: There are still a number of USD bears out there and a 50% intermediate wave 2 retracement to 1.4540 region would not surprise me in the slightest.
On the upside, Rosenstreich advices caution with longs: However, it will be very important to monitor any longs with great care as the retracement may fall short as early as 1.4216 and begin the intermediate wave 3 to 1.2900.