Today's Support and Resistance Levels:
S1: 114.10 R1: 114.51
S2: 113.55 R2: 114.94
S3: 113.24 R3: 115.55
Technical Overview:
The structure, which looked like a perfect triangle, was developing yesterday but it is not even close today. That is exactly one of the tricky things with corrections. They can look like one thing one day and the next day they take a completely new shape. We said that we would go for the flat correction as our favorite, because it is the simplest of the two types of corrections and this has pay out. But what is next? We still think we could see one last decline closer to 113.24 as long as minor resistance at 114.51 protects the upside. However, a break above 114.51 will call for a bottom already in place at 113.55 and a new rally higher towards 115.24 and, more importantly, resistance at 115.55. Any break above 115.55 will confirm the next rally higher trough 116.00 for a move towards the 117.50 - 117.90 area.
Trading Recommendation:
We are short EUR from 114.75 and will move our stop + reverse (turn the short position into a long position) down to 114.65 and keep our take profit + reverse at 113.35.
