Happy New Week Surfers – bye, bye EURO!
In my humble opinion, EURO kissed goodbye to any chance of a short term recovery when it broke through it’s base, formed only a week prior. The 1.2174 level was absolutely crucial for this cross and now it seems gone, with a further plunge almost unavoidable. After spending the entire week struggling for the top of the cliff, EURO let go of the safety rope and tumbled through the relative security of the triple bottom that was providing brief, yet hopeful support. Day’s end saw EURO 140 pips weaker.
Failing to climb above our old Trendline and 1.2333 convergence, in fact rejecting the level dramatically is further condemnation of a totally friendless conveyance. The cross continues to demolish support levels as if non-existent and really,1.1870 seems a formality. We are now ticking off some historic levels and the prospect of parity no longer seems as remote a possibility as it did pre GFC when 1.60 was the number. Despite my fondness and dependency on our Pivots, the combined magnetic strength of a conjoined Daily & Weekly may not be enough to cajole a headstrong currency away from it’s fixation with the nether regions. It’s a fact however, that this force to the North and an open gap (that makes 3 – remember the 2 a gazillion pips ago??) should draw Price Action back towards 1.2174. As a technician, that will be the criteria I use to trade around today.
The Day Ahead
The overwhelming sentiment is Bearish yet our guiding beacons are screaming ABOVE Price Action. Well, it’s a pretty familiar scenario of late and one that renders us watchers. It’s a classic NLNS (No Long No Short) situation where we can’t enter short because of the influence Daily/Weekly Pivot have on Price Action and 120pips away, not to mention Monthly a further 350 plus. Then there’s an unclosed gap seeking attention! No Longs – well that’s pretty clear also – the market has no bottom! Notwithstanding the points above, there is no sign of any support so that will need to come with Price Action and that might take a while. We mustn’t lose sight of the fact that we trade what we see, NOT what our sentiment tells us – even if it’s overwhelming!! If we see confirmation of a reversal – we’ll be there.
Have a good one.
Geoff Pyne | Certified SurfingThePips.com Trader
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