Today's Support and Resistance Levels:
S1: 114.79 R1: 115.22
S2: 114.28 R2: 115.55
S3: 113.65 R3: 116.00
Technical Overview:
With a rise all the way back to 115.55 this rally corrected more than 80% of the decline from 115.96 to 113.65. That means we are likely looking at a flat correction or a triangle correction. If it is a flat correction, we should see a clear five wave decline to below 113.65 to end this correction. If, however, this is a triangle, we should not break below 113.65 before the next minor corrective rally. At this point it's still impossible to say which of the corrections will be the right one, but we normally go with the simplest kind first, which is the flat correction calling for an impulsive decline down to 113.24 as a minimum target. Short-term we will likely see minor resistance at 115.22 protecting the upside from a break below 114.79 for a decline towards 113.93 and maybe even down to 113.55 before the next correction. Only a break above 115.55 will confuse this count calling for a new test in the 115.96 - 116.00 area.
Trading Recommendation:
Our stop at 115.30 was hit on Friday with a minor loss, but now as we have more clear picture of the possible corrective types, we will sell EUR at 115,20 or upon a break below 114.79 (114.75) with a stop at 115.60. Take profit will be placed at 113.35.
