Weekly Report 02/01 -06/01/ 2012

The pair has slipped sharply downwards, breaching through 61.8% Fibonacci retracement of the upside rally from 75.50 to 79.50 zones as seen on the provided daily chart. The negative closing below SMA 50 and the negativity appearing on indicators are technical factors that may bring additional bearishness. But, we are very close to the most important correctional level of 76.4%, while Stochastic is on its way to enter oversold areas. Thereby, risk versus reward ratio becomes too high, forcing us to stay aside during this week. Of note, a break below 76.4% will be an indication that the significant low around 75.50 will be revisited.

The trading range for this week is among key support at 75.50 and key resistance now at 78.80.

The general trend over short term basis is to the upside, targeting 87.45 as far as areas of 75.20 remain intact.

Previous Report

Support76.6076.4076.1075.8075.50
Resistance77.3077.6077.9078.3078.80
RecommendationBased on the charts and explanations above our opinion is, staying aside since the risk versus reward ratio is very high.