Weekly Report 25/07 -29/ 07/ 2011

The bullish harmonic AB=CD pattern which has been formed from 1.6745 to 1.5780 succeeded in sending it to approach the first extended technical objective at 76.4% of CD leg as we discussed earlier. We are not completely sure if the pair will penetrate this sensitive level around 1.6365 to achieve more extended waves according to the harmonic rules of achieving the targets or it will accede to the obvious overbought sign appearing on RSI 14 as the pair always acts in response to RSI 14 in both overbought and oversold cases as seen on the graph. Consequently,we will be neutraluntil we seewhether the pair will hit the initial 76.4% retracement of CD leg or the bearishness will come back into focus. The secondary image of the daily studies proves that the pair has retested the previous broken uptrend line which carried the bullish wave from 1.4225 to the peak of 1.6745 and this is an additional technical process that prevents us from supporting a specific direction for the time being since this action is always followed by resuming the recently established new trend appearing after the breakout.

The trading range for this week is among key support at 1.5935 and key resistance at 1.6550.

The general trend over short term basis is to the downside, targeting 1.4225 as far as areas of 1.6875 areas remain intact.

Previous Report

Support1.62501.61901.61251.60751.5935
Resistance1.63651.64401.65001.65501.6610
RecommendationBased on the charts and explanations above our opinion is, staying aside until a clearer sign appears to pinpoint the upcoming big move.