Today's Support and Resistance Levels:
S1: 1.5785 R1: 1.5833
S2: 1.5738 R2: 1.5893
S3: 1.5688 R3: 1.5934
Technical Overview:
The red wave ii correction went for the slightly deeper corrective target near 1.5671, where it would have corrected 70.7% of red wave i. The 70.7% corrective target is pretty common in the FX-market. With a low at 1.5688 we do think the red wave ii correction is over and a new rally just ahead. However, we still need a break above 1.5908 and more importantly 1.5988 to confirm that a low has been seen. For the short term we will likely see minor support in the 1.5776 - 1.5786 area protects the downside for a break above 1.5835, which would call for a rally higher towards at least 1.5892 and possibly even higher towards all important resistance at 1.5988. The risk is a break below 1.5738 that would call for a move closer to 1.5671 before we can expect a new rally higher.
Trading Recommendation:
We are long EUR from 1.5755 with a stop at 1.5650.
