The chart shows my working count for the rise started from this month€™s low 1.2457. The up-move is very strong but I think that we deal not with an impulse but with a complex corrective combination. If this assumption proves to be correct, the said up-move should be part of a triangle (unfinished yet) which means that the expected stronger up-move for a re-test of 1.4718 high is still not started. With an eye on the above thoughts I exited yesterday the long position opened on Monday and even tried to sell unsuccessfully two times with close stop loss. However nevertheless of the market strength, I still expect a fall of at least 61.8 % retracement of the movement started from 1.2457. If the high is already seen (this is not likely upon me because a test of 1.3200 could be expected), the corresponding level is 1.2720. A first signal for this scenario will be a break below 1.2986 so I put a sell stop order below this level. Only a sharp rise from here of at least 200-300 pips will abort the idea for a forthcoming fall and will prove that the rise is impulsive, not corrective as I think.
Trading strategy: 10:50 EST; 14:50 GMT
The short position from 1.3010 was closed at 1.3075 with loss 65 pips
Sell again on break of 1.2986(sell stop order at 1.2985), stop loss - 1.3160, target € 1.2720
This analysis has only informational and educational purpose and does not represent a proposal for buying or selling currency contracts.