Weekly Report 25/07 -29/ 07/ 2011

The potential reversal zone -PRZ- of our caught bearish Gartly harmonic pattern affected the pair, and we see tahtit has reached 23.6% Fibonacci correction at 1.4330 inline with our previous expectations. But, the first target of the most harmonic patterns begins at 38.2% Fibonacci correction of the CD leg, which means that Gartly harmonic pattern's first target is around 1.4270. Therefore, trading below 1.4490,argues us to expect a downside correction during this week. A breach of the last level mentioned may support the pair to reach the X point near the peak around 1.4580.

The trading range for this week is among the major support at 1.4060 and the major resistance at 1.4650.

The short-term trend is to the upside with steady daily closing above 1.2795 targeting 1.5135.

Previous Report

RecommendationBased on the charts and explanations above we recommend selling the pair around 1.4400 and take profit in stages at (1.4330, 1.4270, and 1.4220) and stop loss with 4-hour closing above 1.4490 might be appropriate.