Sign inJAHResearch's Commentaries
Euro Still Toying With Key Retracement Resistance
The desire for higher yielding assets led traders to buy the EUR USD on Thursday. Positive economic data and signs that the U.S. economy improved helped drive investors out of the safety of the Dollar.
Better U.S. economic data and the steady rise in crude oil prices should continue to encourage selling pressure against the Dollar. The only strength in the Dollar we saw this week was following the announcement that Russia would cut its purchases of U.S. Treasuries. Barring any surprises tomorrow, look for the uptrend to continue.
On the technical side, despite yesterday's weakness, the Euro could not follow-through to the downside and challenge the two Main Bottoms at 1.3804 and 1.3791. A trade through these two prices would have turned the Main Trend down.
The Main Trend remains up and by regaining the retracement zone at 1.4070 and 1.4133; this market is now in a bullish position to test the recent high at 1.4337.
Bearish traders will have to wait until this pair starts to show weakness again. Falling back below 1.4133 will be the first sign of weakness, followed by 1.4070. As long as this market remains inside of this retracement zone, it is still vulnerable to short-term corrections. The key to sustaining the rally will be regaining and holding above this zone.
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