EURUSD: Sees Further Downside Momentum, Test And Breach Of The 1.2484 Level Envisaged.
EURUSD- EUR saw an acceleration of its medium term price momentum the past week breaking and closing below a band of support levels to close the week lower again at 1.2624.The pair is down 5.86% the past week and 13.46% YTD.With a decisive breach of the 1.3259(Sept 10’08 low) and 1.2728(Oct 22’08 low) seen, EUR now looks to weaken further lower through the 1.2484 level, its Oct’06 low and extend additional losses towards its Jan/April’06 highs at 1.2334/24.Thenext two big support levels are located at the 1.2134 level, its .50 Ret(its 0.8231-1.6038 high, monthly chart) and then its Nov’05 low at 1.1640.Weekly and monthly momentum indicators are bearish supporting the current declines. On the upside, recovery if triggered should shape towards 1.2728 and its Jan’07 low at 1.2866 where a cap is expected or at most the 1.3058 level, its .618 Ret (0.8231-1.6038 rally, monthly chart).This level should turn the pair back down to continue its medium term weakness. On the whole, losses of the mentioned key support levels have now opened the door for price extension targeting the 1.2484 level and beyond.
Directional Bias:
Nearer Term –Bearish Short Term –Bearish Medium Term –Bearish
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