Prices are hovering below resistance at the top of a Rising Wedge pattern carved out since late July (1.2618), a barrier reinforced by the top of major falling channel guiding prices lower since late August 2011 (1.2634). A break higher exposes the 1.27 figure. Still, a Bearish Engulfing candlestick pattern continues to argue for a downside bias, with only a close above the formation’s high (1.2588) acting to neutralize. Wedge bottom support is now at 1.2407.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com
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