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The pattern started on the 17th of September, 2012, when the pair peaked above the 200-day SMA to 103.86; currently it is trading at 130.56. Trading volume seems to be volatile in the length of the pattern.; the gap between the pattern's support and resistance narrows by 900 pips in 100 bar period. Technical indicators on aggregate point at appreciation of the pair on 1M horizon suggesting it should continue following pattern's, upward sloping, trend. Long traders could focus on the 20-day SMA/weekly pivot (PP) at 31.41/53, 133.08/87 area (weekly and monthly pivot (R1), Bollinger band, pattern's resistance and recent high) and weekly pivots at 135.36 (R2) and 136.91 (R3).
At the moment market has bearish tendencies—60% of all outstanding positions are short on the pair. Bollinger band/weekly pivot (S1) at 129.47/24, weekly pivot (S2) at 127.96, pattern's support at 27.03 and 100-day SMA/monthly pivot (PP)/weekly pivot (S3) at 126.34/125.41.
Main fundamental events which could have significant impact on the pairs development in the near future are Bank of Japan governor speech on 28th of May, Spanish 10-y bond auction on 29th of May and 6th of June and ECB's minimum bid rate announcement and press conference on 6th of June.
© Dukascopy Bank SA