This weeks Trend:


EUR/USD

Weekly Trend direction: Bullish

Weekly trend reversal level: 1.2940

Support levels: 1.3090, 1.3050, 1.3000, 1.2950

Strategy: Whilst above the weekly trend reversal level, buy dips to support after an entry signal.

Medium term: The euro has broken above the large flag formation which has dominated the technical picture in 2006. Now, whilst above 1.2900 (1.2800 max), the euro remains in an uptrend which is heading back towards 1.3600, the multi-year high, and possibly higher still, towards 1.4100.

Today: Again little changed as we move aimlessly around in a 60 point range. The longer we consolidate here the better the chance we will continue higher, but we will have to allow for a "spike" below the range first. We need to push through 1.3180/1.3200 today (plus a daily close above there) to attract more momentum buyers, so until that happens, the scenario remains very much the same as yesterday: There is weekly 61.8% Fibonacci resistance just above at 1.3177, so we will continue to allow for dips to 1.3050 (and possibly even 1.2950) before we really get moving higher. Today, hold longs from 1.3100, with stops tightened, or continue to buy dips whilst above 1.2950/1.3000

JPY is bearish, so beware.

Good luck to all, Mike

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