eliottWaves_eur-usd_body_eurusd.png, EUR/USD Hold Could be Beginning of Sharp Move Higher

Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0

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FOREXAnalysis: The EURUSD is trying to hold key support from 1.2875, the 50% retracement of the rally from the 2012 low, late November low and December low. Price is also holding on to channel support from the 2012 low (intraweek) and a former resistance line turned support (blue line). Continued weakness would encounter the October low at 1.2803 and June 2012 high at 1.2747. It’s been a difficult market environment with several false bottoms, which is suggestive of a wedge (ending diagonal). Such patterns often resolve with a sharp reversal.

FOREX Trading Strategy: Looking to get long on a dip into 1.2880/1.2900. Although worried about being taken out on a new low and reversal, capital preservation is paramount and one needn’t risk getting stuck in a waterfall decline. Stop under the 1.2843 low.

LEVELS: 1.2747 1.2803 1.28801.2995 1.31341.3250