Article originally published on innerfx.com and republished here with permission
Quote of the day:“In a networked world, trust is the most important currency.” ~ Eric Schmidt
Good morning. Yesterday’s euro recovery was short-lived as the pair fell back below $1.37 during the Asian session and reached a 10-year low against the Japanese yen. A conference call between Greek Prime Minister George Papandreou, Angela Merkel and Nicolas Sarkozy is one of the most important events today and the euro is likely to remain under pressure ahead of the event.
Here’s a quick look at some charts of interest
Selling on signs of weakness (easy to spot – they’re everywhere) is the best thing to do while it holds below former bottom around 1.39
As you can see, the euro is performing better than the Aussie these days, even though it is taking a beating against its major counterparts. The potential breakout highlighted in my article yesterday is in place and first support is now seen between 1.3230 and 1.3270.
Support around .8650 still holds, so the recovery is intact. I remain bullish on EURGBP as long as we’re trading above .8600
The reversal candle formed two days ago after reaching parity was, indeed, a good selling signal. Sentiment remains bearish although the US dollar is recovering some ground today.