Weekly Report 31/10 -04/ 11/ 2011

The pair declined after reaching around 78.6% Fibonacci correction at 1.4250, to settle now around 61.8% Fibonacci correction at 1.4015 as shown above on the chart. From a classic point of view, the ascending channel is still solid, while the channel's support level is at 1.3905 and the upside move depends on stability above 1.3880-45, where these levels represent the neckline of the inverted head and shoulders pattern. In general, the positivity is still valid, but we do not rule out the possibility for the pair to reach areas around 1.3905 before rebounding to the upside again.

The trading range for this week is among key support at 1.3680 and key resistance at 1.4550.

The general trend over short term basis is to theupsidetargeting1.5135as far as areas of1.2795areas remain intact.

Previous Report

Support1.39701.39401.39101.38801.3840
Resistance1.40751.41201.42051.42501.4300
RecommendationBased on the chart and explanations above, we recommend buying the pair around 1.3905, and take profit in stages at (1.4250 and 1.4390) and stop loss below 1.3800 might be appropriate.