The Euro is attempting a meek advance having carved out a bottom against the US Dollar as expected
after showing a bullish Morning Star candle pattern. Near-term
resistance is at 1.1533, the February 3 high, with a break above that on
a daily closing basis exposing the 38.2% Fibonacci retracement at
1.1659. Alternatively, a turn below the 1.1276-1318 area (January 30
close, 14.6% Fib expansion) clears the way for a test of the 23.6%
threshold at 1.1185.
Our long-term fundamental outlook
calls for broad-based Euro weakness as the ECB expands stimulus. With
that in mind, we will treat on-coming gains as an opportunity to
establish short following the upswing rather than a long trade setup. In
the meantime, we will remain flat.
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