Price:   1.6378

Bias:  While 1.6323-28 holds a break above 1.6404 will trigger a final rally to 1.6539-76 else expect sharp losses

Daily Bullish:

While we saw gains yesterday these stalled at the high end of the 1.6460-89 resistance and caused a pullback. It leaves things a little uncertain. Overall I still prefer to see one more rally but feel we do need to exercise caution. A break above 1.6391-04 will assist and extend gains above 1.6435 and back to the 1.6488 high. This may cause a brief reaction but overall I feel we should reach 1.6539 minimum with an outside chance of 1.6576-98. At all times be aware of any bearish reversal pattern that may develop.

MT Bullish:

16th October:  Clearly this was a surprise but I feel the structure of the rally is corrective. It is difficult to be precise at this stage but I see broad resistance areas at 1.6374, 1.6457-67 and the 1.6531 & 1.6596. With luck we'll see the high at the same time at EURUSD...

Daily Bearish: 

I hadn't expected such deep losses to 1.6328 and it does cause me some uneasiness as hourly & 4-hour momentum are showing bearish divergences and we have reached the minimum level for a correction at 1.6488. However, wait for loss of 1.6323-28. If seen then it will open up the risk for a return to the 1.6240 swing low. I suspect this could support for a while. Once broken the downside could accelerate if we are seeing the general reversal elsewhere. Note the pivot support around 1.6120-25 also.

MT Bearish:

20th October:   While the 1.6457-67 resistance should still be watched I still have a preference for a move as high as 1.6554-98 before this corrective rally finally stalls. Just be cautious in both areas. Only a drop below 1.6220-26 would signal a more direct reversal…

For a full description of how to use the analysis please see the Analysis page of my website. The prior day's set ups for potential trading levels highlighted in the report are now available on the Daily Forecast page of my web site.