Weekly Report 20/12 -24/ 12/ 2010

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The pair continued collapsing during Friday's trading as seen on the provided daily chart. This decline sent it downwards below 50% Fibonacci level of XA leg and therefore, the harmonic scenario of forming Gartley pattern is still in favor, where we believe that the CD leg is still in progress, targeting 78.6% of XA leg. If this scenario continues dominating the movements of the pair successfully, we will watch out the price behavior around 12810 very carefully as a daily closing below it will turn the pattern into a crab pattern, targeting 121.65, where 161.8% of XA leg exists. Anyway, more downside actions could be seen during this week.

The trading range for this week is among key support at 125.50 and key resistance at 134.80.

The general trend over short term basis is to the downside, targeting 118.80 as far as areas of 150.75 areas remain intact.

Previous Report

Support129.40128.40127.60126.80125.50
Resistance131.00131.60132.50133.65134.20
RecommendationBased on the charts and explanations above our opinion is, selling the pair around 130.50 targeting 128.10 and stop loss above 132.60 might be appropriate.