EURUSD: Corrective Recovery Powers Through The 1.3005/58 Area, Exposes The 1.3259 Level
EURUSD: With the nearer term recovery started at the 1.2330 level(Oct 24’08 high) set to continue after cutting through the 1.3005/58 area, its Oct 23’08 high/.618 Ret (0.8231-1.6038 rally, monthly chart) and opening Thursday trading session higher, former support turned resistance at 1.3259 is now being targeted. Above there if seen should pave the way for a run at further upside targets located at the 1.3443 level, its Oct 06’08 low and the 1.3666 level, its Dec’04 high. Price momentum keeps the 1.3259 level at risk of being taken out although this key resistance level looks to turn off EUR’s corrective strength on initial retest (seen in early trading today). Daily studies are bullish and heading higher suggesting further strength.Alternatively, the invalidated resistance at the 1.3005/58 area should now reverse roles and provide support on any decline from the present price level. Below there will drive the pair further lower towards the 1.2728 level, its Oct 22’08 low and then the 1.2484 level, its Oct 06 low followed by its Oct 28’08 low/Jan/April’06 highs at 1.2330/24.This level remains the key support to be broken to end the present corrective upmove and trigger the EUR’s decline off the 1.6038 high towards the 1.1827 level, its Mar’06 low and eventually the 1.1640 level, its Nov’05 low.G10 currency universe and our 7 currency model remain in their various corrective phases supporting the pair’s current corrective price recovery. On the whole, medium term outlook remains to the downside indicating that the present upmove remains corrective of EUR’s weakness started at the 1.6038 level.
SupportComments
1.3058/05Oct 23’06 high/.618 Ret (0.8231-1.6038 rally, monthly chart)
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