Article originally published on innerfx.com and republished here with permission
Quote of the day: “Free advice is worth the price.” ~ Robert Half
Good morning. Things are getting uglier for the euro on more sovereign default worries. European and IMF experts return to Athens this week for a fiscal audit in order to decide whether Greece can dodge default. German Ifo Business Climate is the main event of today’s economic calendar. Let’s see what are the most interesting charts today and what trading setups are worth your attention
former support at 1.3500/30 is now providing the first short-term resistance. However, it should be quite difficult to climb that high – given current downside pressure – but it case it does, signs of weakness are what to look for before joining the bears
The weekly chart is quite interesting, as seen below – the euro is breaching below the median retracement value of the entire upward move. In theory – 1.3000/80 is likely to be the next target.
The breakout mentioned in my previous report was a great setup as the euro rallied far above former resistance at 1.3450. Anyway, there are no signs of exhaustion yet and it seems that a new breakout is in the cards – this time above a more important level: 1.3850
This was an awesome setup as the break above 1.9550 provided a great buying opportunity, as noted in my previous report. As seen below, next objective comes around 2.0400 where price reversed in July, forming a large reversal candle. Buying on strength is probably the best thing to do for now.
After an impressive decline, gold is currently finding some bids around critical support zone. Not sure whether it looks cheap or not right now, but buying is worth a shot – if support is confirmed.
and the weekly chart:
resistance around .8800 was too strong and the euro collapsed, currently testing 50% of last up leg. I don’t feel comfortable looking for buying opportunities at these levels, therefore I’d prefer to sell on the potential break below 50%.