Top in the Euro?
- Reverses from key resistance area
- Cycle also turning negative on the exchange rate
Unfamiliar with Gann Square Root Relationships? Learn more about them HERE.
We have written a lot recently about the importance of this week for EUR/USD from a timing perspective. Interestingly this turn window coincided with the ECB monthly meeting. This fundamental catalyst did not seemingly disappoint as the Euro briefly spiked through a key Fibonacci level at 1.3970 to touch its highest level since October of 2011. The technical break proved short-lived, however, as the rate quickly turned down leaving a large range reversal and possible double top on the daily. With our cyclical analysis pointing to a peak around this time we believe today’s failed break higher is probably the start of a larger downside move. We like selling the single currency on strength against 1.3995.
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EUR/USD Daily Chart: May 8, 2014
Charts Created using Marketscope – Prepared by Kristian Kerr
Key Event Risk in Coming Sessions:
LEVELS TO WATCH
Resistance: 1.3900 (Psychological), 1.3995 (YTD high)
Support: 1.3830 (Gann), 1.3765 (Gann)
Strategy: Sell EUR/USD
Entry: Sell EUR/USD at 1.3910
--- Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com
To contact Kristian, e-mail firstname.lastname@example.org. Follow me on Twitter at@KKerrFX.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.