09/24/08 7:39 am - EURUSD: Heading lower

The pair continues to consolidate, and rejected 1.4740 this morning (declining TL resistance). The houlies don’t show a clear bottom yet, and I expect a retest and break of 1.4620 during the NY session. Next support is found at 1.4592 (61.8% Fibo retracement), and more significant support around 1.45. A return to 1.45 is likely, and if recent volatility continues the correction may go well beyond that.

Alternatively, we could see a sustained break of 1.4750, and a retest of the prior high at 1.4866. If that occurs, there is a good possibility of a failure at that level, and return to lower levels.

Action Plan: Sidelined. Plan on going long on bounce out of the 1.4490..1.4507 area.

Support: 1.4592 Fibo68    1.4545 HSppt    1.4507 Fibo50

Resistance: 1.4866 H-9-22    1.4907 H-8-22    1.4961 DFibo50

RSI: Hrly: lacks direction, Dly: key resistance at 66

Hourly Chart:

September 24, 2008 · Filed under EUR/USD

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