02/23/10 10:13 am - EURUSD: Breaking key support at 1.3530, further downside

The failure to sustain the break above 1.3665 was followed by a sharp drop which stalled at 1.3530. The pair could not find lasting support at this level, which was also the bottom of a rising channel on the hourlies, and price support on the dailies. Hourly RSI is bearish and broke below a rising trendline, but we are near oversold territory.

I expected a rebound from 1.3530 and reset my long at 1.3575, jumping the gun a bit in retrospect since price retested 1.3530 once again after that and broke below it. My stop was set at 1.3515 and just hit, for a 60 point loss. The break below 1.3530 calls for a move to 1.3485…44, and could easily lead to new lows. I’m not going short though since dailies are still losing downward momentum, and we could see a sharp upswing towards 1.3780 any time without much warning.

Support: 1.3485 HSppt   1.3444 HSppt   1.3425 SpptRsst May-09

Resistance: 1.3530 HSpptRsst   1.3585 HSpptRsst   1.3653 HSpptRsst

RSI: Hrly: bearish but near o/s, broke below rising TL, Dly: bouncing from o/s, near decl. TL resistance

Hourly Chart:

EURUSD Hourlies 2-23-10

February 23, 2010 · Filed under EUR/USD

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