Daily Outlook: Good afternoon PipHutters! A bit of a late signal today as we were busy rolling out the new backtesting feature of CandlePRO. This week opened to a lot of downward pressure as the pair charged through 1.3500 support is now well on its way to a challenge of 1.3400:
Between now and 1.3400, though, reset 1.3430 - the falling trend support you get if you connect the Jan 31st low to the Feb 7th low. 1.3400 is the Jan 20th low. In the short-term we view 1.3550 as the key pivot level (below here we are bearish, above we are bullish), with 1.3500 offering a level to re-tool any shorts. Watch for a bounce off of 1.3500 (to the downside) and a bounce off of 1.3430 (to the upside), but the technical picture for this pair is certainly very bearish at the moment.
Trading Idea: Primary trade is a short near 1.3550 with candlestick confirmation and targets at 1.3525, 3500, 3470 and 3440 for 110 pips.
Secondary trade is a short near 1.3500 with targets at 1.3475, 3450, 3425 and 3400.
A much more aggressive opportunity exists at 1.3400 for a long, though we would have to have some very good confirmation to seriously consider going long in the midst of all the bearish technicals. From 1.34 a re-challenge of 1.35 is the obvious short-term target.