© Dukascopy Bank SA
We expect the common European currency to succeed in crossing the monthly S1 at 130.58, which will pave the way down to the pattern's lower edge at 130.11. The latter is in turn guarded by the weekly S1 support line. Failure here would imply another sell-off into the 129.60 area (weekly S2), followed by the weekly S3/monthly S2 at 128.54/40. Technical studies support the negative scenario for the moment, as they are giving aggregate "sell" signals on 4H and daily time-frames. Moreover, the Euro is overbought among SWFX market participants. Long open positions are holding a share of 74%, meaning there are plenty of opportunities for bears to come into the market.
© Dukascopy Bank SA