Guest Commentary: MarketVisionTV - Why are Gaps so Helpful in Timing EURUSD Trades
The Euro has maintained the Extreme Vigilance trade similar to last July and therefore suggests a larger decline with a twist.
1. We need further weakness to 1.2895 to satisfy the decline.
2. Gap Theory should help maintain this weakness.
3. We will look to cover shorts and buy this weakness for a whipsaw rally.
The Euro broke the 1.3095 interim low to confirm not just an attack on the 1.2995 pivot but also a break to encourage a larger decline.
Although the price action is very similar to that last July in the Italian spike, the fortunate thing about that analogy is three things. Firstly it still begs a trend sequence down from 1.3285 therefore suggesting the reaction from 1.2955 is part of a correction to an ideal 1.3040-65 the 38.2%-50% retracement before a final short term spike down to a C=A target and possible approximate 5=1 objective of 1.2895. Secondly, that this therefore maintains the Gap theory of the NY break gap, the 1.3080 global and possible midway gap begging a possible final gap low to create the final spike. Thirdly this provides a very clear trading strategy. We are maintaining the Extreme Vigilance Short and will add short term on this rally with 1.3100 stops looking to cover and attempt longs on the next new low or a rally back through 1.,3100 for at least 150 point corrective rally. A loss though of 1.2800 would extend further to 1.618 objective of 1.2655 close to the 1.2625 low.
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