The FX Trader’s view – After a dramatic breakdown at the end of 2009 the move lower has notably slowed this year. Clear technical support has recently been found, but bulls so far remain reluctant to move from the shadows.
- WEEKLY CHART:
The decisive break below 1.5000 support in Dec-09 has seen an unhindered slip back to the Mar-09 low.
Clear support has emerged around here. - DAILY CHART:
Following an unusual price swing in early Feb, which tested the Mar-09 low, we have been looking closer for evidence of a temporary bull resurgence.
At this stage a close above the 1.4700 23.6% level would provide an initial bull sign; a further one would be a close above the 1.4785 38.2% level.
Higher 1.5000 area, where several former lows reside, offers a tough barrier should any stronger recovery develop.
The overall structure of the breakdown from the 1.5150 area in Dec suggests that there is more downside to play for in due course – so any bounce should prove temporary.
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