06/30/09 8:04 am - EURUSD: Bounce expected

Sharp selloff into the London close took the pair all the way down to 1.40. Since this selloff followed a rather steady upmove without blowoff top or major overbought divergences, I expect it to be followed by a recovery. There is also good support in the 1.40 area: 1.4010 is the dailyEMA10, 1.4013 is a 61.8% Fibo of a recent range and repeatedly validated support/resistance, and below that we have 1.3982 (50% Fibo) and 1.3970 (rising long term trendline). Not a good setup for the bears at this dynamic, and I believe we’ll see a rather sharp bounce from here.

I added another long position at 1.4010, stop tight at 1.3955 and target is 1.4075.

Support: 1.4010 DEMA10, Fibo62 1.3982 HRsst, Fibo50, L-6-29 1.3970 TL Sppt

Resistance: 1.4100 HRsst 1.4151 H-6-30 1.4177 H-6-11

RSI: Hrly: near support and o/s, Dly: turning up, bullish

Hourly Chart:

June 30, 2009 · Filed under EUR/USD

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