Weekly Report 27/12 -31/ 12/ 2010

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The royal pair is supported as well above 61.8% Fibonacci retracement of XA leg of the suggested harmonic butterfly pattern as seen on the provided four hour chart. Additionally, SMA 50 is still carrying the bullishness from below beside the uptrend from C point. Henceforth, the harmonic CD leg is still in progress and we still believe that the pair will achieve additional ascending movements during this week, particularly if it closed positively above 0.8535 zones. Note that, the pattern is bearish when it is completed and that is why we look at the expected bullishness as atemporal upside wave.

The trading range for this week is among the key support at 0.8325 and key resistance now at 0.8675.

The general trend over short term basis is to the downside, targeting 0.7780 as far as areas of 0.8965 remain intact.

Previous Report

Support0.84700.84450.83900.83700.8355
Resistance0.85300.85600.85850.86300.8680
RecommendationBased on the charts and explanations above our opinion is, buying the pair around 0.8490 targeting 0.8700 and stop loss below 0.8380 might be appropriate.