The EURUSD had a significant bullish momentum yesterday, broke above 1.3420, topped at 1.3531. The bullish momentum was triggered by risk appetite sentiment after China cut the RRR by 50bps and the joint action of developed countries central bank to decrease swap rates by 50bps to easy liquidity. Technically, this fact turns my short term technical bias to a bullish view testing 1.3613. From another technical perspective as you can see on my daily chart below, price is now testing the upper line of the bearish channel. The bullish momentum should be seen just as a normal corrective movement so far, but a clear break and daily close above the bearish channel and 1.3613 resistance area could turn my technical bias to a bullish view. Immediate support is seen around 1.3400/20 (former resistance). A clear break back below that area could give another chance for the bearish scenario retesting 1.3270 support area. I personally, like many other people, doubt that this kind of central bank intervention will significantly helping the Euro debt crisis and global financial problem we are facing now. They already did similar action in the past with no significant result. However, the joint action could create confusion and hesitation among investors and messing up technical view in the end of the year so do not rush jumping into the market.
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