Present price action is similar to that seen during the November 2007-February 2008 consolidation before EURUSD headed higher again (rallied from 1.44 to 1.59 over a period of 5 weeks- The prior rally off the support line was from just above 1.33 to above 1.49 in the 3 months into November 2007.)
Interesting note- The time gap from the trend line support on 16 August 2007 to the trend line support on 07 Feb 2008 (the 2 prior points of major rallies) was 175 days. The timeframe from 07 Feb to today got within 11 pips of this trend line was 174 days. The fall into the 07 Feb low was a fall of 516 pips from high to low. The present fall has been 518 pips high to low.
There is a good chance that the low is now in and we are ready for another move higher. Below the major supports in the 1.5285-1.5340 area would seriously question this thought while a break back over 1.5665 would tend to validate it (55 day moving average). If the former happens much lower levels would be on the cards but if the latter happens and early re-test of the trend high above 1.60 would look likely.
On a more medium term basis, a move to the mid and possibly high 1.60’s remains a danger.
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