Thursday, May 17, 2012

EURUSD Short Term Opportunity

Current Market Outlook - Strongly bearish

With EURUSD falling without any signs of retracement since 1.30, we would expect a retracement up. We could either await for the retracement to complete before taking a short position or we could wait in anticipation and adopt a counter trend trade. A counter trend trade appears favorable as EURUSD bounces off a key support of 1.26670. We would expect this support to be supported as bulls would be interested to buy while bears would be taking profits.

Strong support seen in multiple time frames

1.26670 appears to be the low of 2011 which indeed proves it is a strong support.

Bull looking to trade this pair would look for a valid trigger and watch 1.2780 (potential take profit target) as a potential turning point where price will bounce off and resume the downtrend.

Currently entered a position at 1.27087 with stop loss 15 pips below the key support of 1.26670.

Watch out!

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