EURUSD: Backs Off Lower Price With Caution

EURUSD- Having continued to maintain is corrective weakness triggered at the 1.5062 level, EUR weakened to as low as 1.4625 on Tuesday before bouncing off that low to close marginally lower at 1.4731. With a rejection candle now in place, the pair could be preparing to trade higher. In such a case, its Nov 02'09 high at 1.4844 level will be aimed at with a loss of there allowing the EUR to strengthen further towards the 1.5000 level and then its YTD high at 1.5062 with a loss of there  triggering the resumption of its medium term uptrend now on hold. We still retain our bearish outlook nearer term on the pair unless a break and hold above the 1.4844 level occurs. Initial support lies at the 1.4625 level ahead of its MT rising trendline currently at 1.4593 where we expect a cap but if that fails to materialize, price acceleration should shape towards the 1.4479 level, its Oct 02'09 low. On the whole, though vulnerable to the downside, EUR looks to build on its rejection candle printed on Tuesday.

Daily Chart: EURUSD