FXstreet.com (Barcelona) - The Euro has rallied almost 500 pips since failure to break support level at 1.2551 (Dec 4 low) on Friday, which, according to Mohammed Isah, technical analyst at FXTechstrategy, responds to a corrective move that could reach as high as 1.33.
Isah observes a rejection candle at the end of the week as a signal to a upward move that could reach above 1.30:
The pair's failure to follow through to the downside on the break of the 1.2551 level, its Dec 04'08 has seen it rallied for two days and printed a rejection candle at the end of the week. This development suggests a price follow through higher could occur with targets located at its Feb 04'09/Nov 25'08 highs at 1.3071/81 ahead of the 1.3298/1.3313 zone.
On the downside, Isah adverts the following support areas: The 1.2706/66 area will serve as the initial support followed by its Dec 04'08/Feb 18'09 lows at 1.2551/14 and next its 2008 swing low at 1.2330.On the whole, with another failure at the 1.2706/66 area seen again preventing a weekly close below that zone, EUR is likely to correct higher in the days and weeks ahead.