- 4H and 1H: Last Friday, the EUR/USD rallied from the medium-term (in 4H time-frame) support. (Refer to Weekly Technical Update 11.27.2009.) The pair has since had 2 up-swings to the 1.5100 level.
- The pair then showed topping action, and reversal signals from candlestick action and stochastic reading.
- Still the 1.5040-1.5050 area is short-term support. If this breaks, we may get further decline to the 1.4950-1.5000 area. In the 1H time-frame, we can see this is between 50% and 61.8% retracement.
- In the daily time-frame below, we see that the underlying trend is still bullish and intact. So if the market reaches this retracement zone, we may want to look for bottoming action and reversal signals.
- On the otherhand, we also see the market nearing 78.6% retracement. The projection if a rally materializes is limited to is 1.5300-1.5350 in the short-term (Daily time-frame)
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