EUR/USD Daily Update, Tue 15, November 2011
Good morning,
Market has not accomplished our suggestions of reachng 1.3830 area. Strong hourly support area around 1.3680 has been broken without any respect. That probably tells us that market is gaining bearish momentum again.
So if we take a look at daily time frame we will see absolutely classical bearish behavior - hitting 0.618 target, then 0.382 retracement and start of continuation move down. Trend is bearish, market stands below both pivots.
Also, remember the bottom line of pennant - market has retested it from downside. There are couple of targets below the market. Nearest one is 1.3420 - 1.0 extension from most recent AB-CD. Next is 1.3240 - according current behavior this is the level where market might be going.
On 4 hour chart we see that trend is also bearish. Just below the market 0.618 target from recent AB-CD pattern in agreement with 0.618 support. Still, I'm not very fascinating with it, since this level has been tested already and significantly pierced. So, It will be poor relief for bulls.
On hourly chart trend is bullish. It tells, that probably market could show some retracement up. Also we see not bad context for DRPO "Buy" LAL (too much consolidation between penetrations), second penetration has not happened yet. If market will confirm DRPO and realize it - then we may count on move to 1.3670-1.37 area. There probably we can start to watch for sell signals.
If market will fail to form DRPO - then downward move probably will accelerate.