Quote of the day: Debts are nowadays like children begot with pleasure, but brought forth in pain - Moliere


Trading strategy: looking to sell a small size on rally to 1.3090, stop at 1.3140 (0.5% risk), 1st objective at 1.3040, 2nd objective at 1.2960

Good morning. The Euro rose to $1.3015 session high ahead of Portugal's bond auction. Spain is the next in line - seeking up to 3 billion euros on Thursday's bond auction. Current euro's recovery, which is modest so far, is probably caused by some positions closed in order to avoid potential market turbulence. As mentioned yesterday - I'm expecting this pullback to continue towards 1.3070/00 where more important resistance is formed. Short-term sentiment remains bearish as long as momentum doesn't pick up on a sustained break above the 1.3150-1.3200 region which seems far from here. However, we've seen even larger rallies on short-covering and history has a tendency to repeat itself - especially in Forex. On the lower side, support starts at 1.2950, followed by 1.2870/00 and 1.2800. Intra-day studies are bullish at time of writing and will remain so while 1.2950 provides support.

Support: 1.2950, 1.2870/00, 1.2800, 1.2700 and 1.2600
Resistance: 1.3015, 1.3070/00, 1.3150 and 1.3200
Market sentiment: long term - mixed, medium term - bearish, short term - bearish, intraday - bullish

EURUSD 4hrs chart 1-12-2011
EURUSD hourly chart 1-12-2011

Have a good day and safe trading