Best Financial Markets Analysis Article The recovery in EUR/USD from the Jun low has, so far, been a 3-wave affair and recently found good resistance. There is now the risk that further weakness will mean curtains for the bulls as upward momentum seeps away.

The FX Specialist view

WEEKLY CHART

So far a 3-wave, corrective structure has developed from the Jun low:

- it has failed just ahead of 76.4% resistance, raising questions as to whether the bull move has run its course (note how a former 76.4% level was effective in late 2009).

DAILY CHART:

After the market failed ahead of the 76.4% retracement level (no requirement for this to be tested) the continued drop below the 20-Oct 1.3696 low has provided a modest sign of momentum loss.

However, more important are the current bull channel base (now under pressure) and then the 1.3333 06-Aug high, just above which resides a 38.2% pullback level – violating these supports would have more certain bearish implications.

Subsequent rally attempts should then prove temporary ahead of further bear activity.

Mark Sturdy
John Lewis

Seven Days Ahead
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