My dear friends in whatsapps, telegram, and fxbeat fb too.. as expected after Greece issues, the Euro rose yesterday after using my opinion level at 1.1319 (yesterday drop lower) as a cushion. The accuracy of the test let to a rising move of about 130 pips, and an attempt to break above 1.1434, but the price dropped back below this level soon after reaching a daily high 14 pips above it.
However, the price action seen after reaching yesterday’s high at 1.1448 is not directional, and has resulted in a small triangle, indicating lack of decision. The overall picture is still bullish of course, but the triangle drawn on the attached chart shows that we should be careful, because after triangles, the price could go either way whether downside or upside. However, the triangle is so small that we cannot use its borders to build a trading strategy, so we need to depend on other support & resistance levels.
The triangles top is at 1.1413, but a more important resistance is the falling trend line from February 3rd top, which is currently running around 1.1425. This will be our first resistance for today. A break above this level will open the way higher towards 1.1466, followed by 1.1499 & 1.1534, but once we have a break above 1.1408, we should expect the price to trade above this last level. In this case 1.1567 & 1.1596 make very good targets.
The triangles bottom is at 1.1404, but a more important support is provided by the rising trend line from Tuesday’s Asian session low, which is currently running at 1.1385. A break below this level will open the way lower towards the rising trend line from Monday’s bottom which is currently running around 1.1355. A break below this level would be a strong weakness sign, but the most important support will continue to be 1.1319. As long as this level holds, the Euro will be expected to rise significantly. However, if we get “a small surprise”, and we break below 1.1319, the targets for this break would include 1.1264 & the very important 1.1222. This last level is key for the long term bullish outlook, because a break below it could put pressure on January’s 11-year low 1.1097. Today, please get prepare for FOMC storm at 1900 GMT.
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