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EUR/USD: Intraday Technicals Point to 1.2785 Support

Last updated 2/11/2009 1:42 PM EST (GMT -5) 0 Comments - Add your comment

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FX360 Technical Analyst Staff

Technical Analyst, GFT

New intraday lows following the recent 50% retracement at point C (see 5min chart) suggest a potentially strong bearish continuation. These shallow retracements (as well as 38.2%) often indicate a strongly trending market once new highs/lows are achieved, and typically result in 127.2%-161.8% ABCD extension patterns.

Key support at 1.2785 is defined by the 141.4% Fibonacci extension from the Y-to-Z move at which point the 127.2% ABCD extension pattern is projected to complete. Stops would normally be set just above point C, however, the EUR/USD is also at 2hr bull trendline support as indicated below. This could potentially lead to a more significant correction so stops have been placed at 1.2880 just above the most recent 5min significant high at 1.2876.

2hr Chart - We could potentially see a bounce off bull trendline support	5min Chart - New low coming of 50% retracement at C suggests strong continuation to downside to 127.2% ABCD extension.

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