Euro Pulls Back Before EU Leaders Meet in Brussels

Article originally published on innerfx.com and republished here with permission

The trouble with normal is it always gets worse. ~ Bruce Cockburn

Good morning. Euro trades lower today, before European leaders meet in Brussels to discuss the region’s debt crisis and sign off a permanent rescue fund for the eurozone. Here’s a couple of charts to start the week with:

USD Index

Former support around 79.50 is now providing the first resistance level, so it’s a good idea to keep an eye on it if dollar’s recovery continues

USD Chart Daily 1-30-2012USD Chart Daily 1-30-2012

EURUSD

4hrs chart still looks quite bullish as the higher lows-higher highs formation is intact. Support formed between 1.3100 and 1.3150 is currently being tested. Anyway, even if it breaks – there’s one more important barrier around 1.3050

EURUSD Chart 4hrs 1-30-2012EURUSD Chart 4hrs 1-30-2012

According to latest COT data, there are more sellers than ever – although EUR keeps recovering:

EUR COT Daily 1-30-2012EUR COT Daily 1-30-2012

Silver

33 is currently under pressure as silver pulls back from session highs. Recovery is still strong and corrections are normal – so this could be only a correction.

Silver Chart Daily 1-30-2012Silver Chart Daily 1-30-2012

EURGBP

.8375 was a a tough barrier but was successfully breached on Friday’s rally. It was tested a bit earlier today and EUR found decent bids, so there’s a good chance it will provide a stable support for now

EURGBP Chart Daily 1-30-2012EURGBP Chart Daily 1-30-2012

AUDNZD

AUDNZD starts the week with a potential breakdown below 1.2900/30 which provided a good support for the past two weeks. The cross has been on my watch list for several days, waiting for such a decline below 1.2900, eventually providing a selling opportunity

AUDNZD Chart Daily 1-30-2012AUDNZD Chart Daily 1-30-2012

AUDCAD

Maybe the highlighted candlestick is not the most reliable reversal pattern but it definitely raises a big warning sign, suggesting that there’s an equilibrium between buyers and sellers. It’s a bit too early to call a top but it’s a good idea to keep an eye on this

AUDCAD Chart Daily 1-30-2012AUDCAD Chart Daily 1-30-2012

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About abwehra group

The Art&Science of Trading Gold
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