Weekly Report (29 August- 02 September 2011)

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The pair found good support at 110.00 to bounce and trade around the descending channels' resistance as shown in image. The channel is well protected by the 50 EMA , in addition to stochastic overbought stance. Therefore, we think that it's more likely that the downside move will resume this week, targeting 108.90 and 107.55. While breaching above 111.40 over daily basis may invalidate our expectations.

The trading range for the week may be among the major support at 107.55 and the major resistance at 113.65.

The short term trend is to the downside targeting 100.00 as long as 123.30 remain intact.

Previous Report

Support111.00110.40110.15109.60108.90
Resistance111.40112.10112.70113.65114.10
RecommendationBased on the charts and explanations above we recommend selling the pair around 111.40 targeting 108.90 and stop loss above 112.70 may be appropriate.