picking tops and bottoms

Euro / Dollar: A Bottom May Finally be in Place

Friday, 20 February 2009 19:20:46 GMT  |  Jamie Saettele, Senior Currency Strategist

-A bottom in EURUSD…not the bottom; multi-year trend still down
-Initial resistance not until 1.33
-Short term support at 1.2740. 

Euro / US Dollar

Finally, the EURUSD appears to have put in a solid bottom.  After weeks of brutal choppy action in what was a triangle, the EURUSD broke lower.  However, triangles lead to terminal thrusts.  In other words, moves from triangles complete a larger move in that same direction.  In this case, the break below 1.27 completed 5 waves down from 1.4723.  A corrective advance over the next month (at least) is expected.  Initial resistance is not until 1.33 (former chart resistance and 38.2% of decline from 1.4723).  Support next begins at 1.2740.

Strategy: EURUSD limit order to go long at 1.2750, against 1.2500, target 1.33 and 1.37

Jamie Saettele writes Forex Technicals: The Day Ahead, Monday-Thursday (published at 6 pm EST), Daily Technicals  every weekday morning (9 am EST), COT Analysis (published Monday mornings), and analysis of currency crosses throughout the week.  He is also the author of Sentiment in the Forex Market.

Contact at jsaettele@dailyfx.com

 

 

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