Daily Outlook: With the descending triangle intact there are three obvious trade setups/signals : 1) sell at the falling resistance, 2) sell on a break of the horizontal support and 3) buy on an upward breakout. Shorts have the highest probability of success in these setups as the short, medium and long term trends are all bearish. We do have some news coming out tomorrow that you need to be aware of, mainly GDP data for Europe and the NFP data for the US. Read the forex calendar here for more details.
Trading Idea: As usual I will probably stay out the markets today unless a juicy short opp presents itself. The primary trade is a short on failed challenge of the falling trend resistance around 1.2250-1.2270 (though this keeps falling). From 2250 short targets are 1.2225, 1.2195, 1.2165 and 1.2140 for 110 pips profit. Secondary trade would be a short on a break of 1.2100 with short targets down to 1.2000 for 100 pips profit.
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