Weekly Report 28/11 -02/ 12/ 2011

Consenting to the previous report hinted oversold signal on RSI 14, the pair started the week with a gap above 76.4% Fibonacci retracement of the entire upside rally from 1.5270 to 1.6165 as seen on the provided four-hour chart. The current upside recovery could reach the upper line of the downside channel where RSI will enter the overbought areas once more. The aforesaid descending channel's resistance is very close to 61.8% Fibonacci retracement and it may act as a point for the potential resistance where thedownside rally will be resumed. A break back below 1.5410 areas will bring panic sell-off actions, chiefly targeting 1.5270 zones.

The trading range for this week is among key support at 1.5075 and key resistance at 1.5820.

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

RecommendationBased on the charts and explanations above our opinion is, selling the pair around 1.5560 targeting 1.5270 and stop loss above 1.5750 might be appropriate.