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- EUR/USD Technical Strategy: Pending Short
- Support: 1.3673-90 (61.8% Fib exp., wedge floor), 1.3598 (76.4% Fib exp.)
- Resistance: 1.3734 (50% Fib exp.), 1.3795 (38.2% Fib exp.)
The Euro may be gearing up for a corrective bounce against the US Dollar after prices produced a Hammer candlestick. A reversal above resistance at 1.3734, the 50% Fibonacci retracement, targets the 38.2% level at 1.3795. Support is now in the 1.3673-92 area, marked by the 61.8% Fibonacci retracement and the bottom of a rising wedge chart formation in play since late last year. A break downward on a daily closing basis initially exposes the 76.4% level at 1.3598.
A Hammer candle represents indecision rather than an actionable trade signal. We will continue to stand aside for now, waiting for any corrective upside move to offer a selling opportunity in line with our long-term fundamental outlook.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com