G’day Surfers – there is an upside for EURO, is it sustainable?

Yesterday’s Report

How pleasing it was to see the market act appropriately and deliver us something we’ve sought for many sessions – pure technicals! Ok, yes we made and are still making pips but the REAL value to me yesterday was the market’s behaviour. Yes EURO’s rally was triggered by bad USA news BUT, the fact that buyers entered the market POST news, highlighted the efficacy of the double bottom (since become a triple) that was a prominant feature of our analysis. The trading day began like most recent others, with EURO falling. It reached our very faithful 1.2174 level for the third time in as many days and performed a 138 pip salto.
We recognised the potential for Longs and placed an early M30 order which the market refused to trigger. This Price Action served only to strengthen our resolve and our setup, producing a classic Surfing The Pips Secret Pattern at resistance and we are currently riding the wave headed hopefully, to our 1.2334 resistance level.

Technical Analysis

Whilst I’m certainly happy with that target, I have a HUGE electromagnet attempting to slurp Price Action into it’s powerful jaws. The Old Firm of Daily & Weekly Pivots have now embraced each other and we know that means hot ACTION. That the market tends not to stray too far from these bosom buddies, is the reason I see yesterday’s reversal copping a reality check today. Good news is I do see Price Action wanting to re-test the underside of our aged S/R Trendline before it succumbs to the temptation of a menage a trois. The convergence of the old trendline and 1.2334 is definitely the focal point notwithstanding the Pivots however and it’s here that EURO will face the acid test – NORTH or SOUTH??

The Day Ahead

There is potential for us to trade both short & long today. That Price Action has begun the difficult climb from the seemingly bottomless pit is one thing but the strength of the Bearish tide will produce weary stages. I see a pullback to Daily Pivot as a potential Short and I see the possibility of further upside and a break above 1.2334. Could be quite an interesting session – I look forward to it.

Happy Days,