EURUSD: A Cut Through Layers Of Support Now Leaves EUR Exposed To Declines Towards The 1.2484 Level.
EURUSD: A cut through key supports at the 1.3259 level, its .618 Ret (0.8231-1.6038 rally, monthly chart) at 1.3058 and the 1.2980 level, its Jun’06 high now leaves the pair exposed to declines towards its Oct’06 low at 1.2484.While another support lies at its Jan’07 low at 1.2866, that support is vulnerable to being taken out leaving coast clear for further declines. Below the 1.2484 level will put EUR on the path to further weakness towards its Jan/April’06 highs at 1.2334/24 with a loss of there extending prices lower targeting the 1.1827 level, its Mar’06 low. Daily and weekly studies are bearish though in oversold territories. In the meantime, if a recovery is seen, it should shape towards the 1.2980 level, its Jun’06 high and its .618 Ret (0.8231-1.6038 rally, monthly chart) at 1.3058.These levels are expected to reverse roles and provide resistance but if strength is seen above here, the 1.3259 level will then be targeted where we expect a cap and then a turn lower (though signs of this happening are yet to occur). On the whole, having triggered a fresh leg of decline, the 1.2484 level is now highlighted.
SupportComments
1.2866Jan’07 low
1.2484 Oct’06 low
1.2334/24Jan/April’06 highs
ResistanceComments
1.2980Jun’06 high
1.3058.618 Ret (0.8231-1.6038 rally, monthly chart)
1.3259YTD low
1.3344/66 Oct 16’08/Dec’04 high/August’07 low
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