EURUSD Forecast

The EURUSD gapped up earlier today after the news that Spain will get EUR 100 billion aid/bailout to recapitalize its banking sector. Price opened at 1.2643, more than 100 pips higher from Friday’s closing price, turned my nearest term bias to a bullish view. We have seen bailouts of some EU members failed to stop the single currency from falling and only created temporary short term bullishness so I won’t be surprised if the current strong bullish momentum will be short lived. Back to the technical part, a clear break and daily close above 1.2641 will interrupt the major bearish trend testing 1.2730 – 1.2822 resistance area and stop my bearish mode. On the downside, we need a clear break and daily close at least back below 1.2500 to keep the major bearish scenario remains intact.

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