Article originally published on innerfx.com and republished here with permission
Here’s something to think about: How come you never see a headline like ‘Psychic Wins Lottery’? ~ Jay Leno
Good morning. Euro recovered some ground after sliding to as low as $1.2945 two days ago, but the move is likely corrective and there’s more room for it to move higher.
As seen below – current pullbacks is rather corrective and it should be interesting to watch how recent resistance will react to a potential test
Bulls shouldn’t be too confident in current conditions, as downside pressure remains high mainly due to fears of new downgrades. Therefore, selling into strength is still the main theme
and here’s an hourly chart to please day traders
The bullish setup highlighted in my previous post was quite good, as GBP rallied for 150 points above resistance at 1.5500. I still believe it’s a good idea to hold onto longs or keep buying while 1.5500 holds
Not such an interesting setup yet as the consolidation continues but it’s probably about to become a good setup soon. As seen below, there clearly is a lot of selling going on around 1.32 which keeps the pair trapped in this range for weeks, so it’s probably best to look for an exit of the range – below 1.3050
Although the pair has been quiet in the last two days, 100 is still in focus. Don’t expect any BoJ interventions as the USDJPY keeps recovering and that’s the important pair in the intervention-hope equation.
The question now is whether the entire decline to 77 was a corrective cycle – however, selling into strength a bit above 78 is tempting.