With a hammer generated recovery off the 1.5326 level triggering a fresh upside gains in early trading today, hope of further gains is developing. This will put the pair on the path of further recovery towards the 1.5661 level, its Sept 30'2011 high. A breach of here will turn risk towards the 1.5713/79 levels. However, we expect these levels to cap gains if seen and then turn the pair back lower in the direction of its medium term downtrend. Further out, resistance stands at the 1.5863 level, representing its Sept 15'2011 high. On the downside, a return below the 1.5270 level, its hammer candle low will resume its medium term downtrend towards the 1.5122 level, its July 18'2010 low and possibly lower towards the 1.5000 level, its big psycho level.

/