EUR/USD: Euro Slumps To Monthly Low Against Dollar
Dailyfx | May 12, 2014 01:01AM ET
- EUR/USD Technical Strategy: Pending Short
- Support: 1.3734 (50% Fib ret.), 1.3673-81 (61.8% Fib ret., wedge bottom)
- Resistance: 1.3795-1.3810 (38.2% Fib ret., trend line), 1.3932 (double top)
The euro slumped to the lowest level in a month against the US dollar, breaking trend line support and hinting a double top is set below 1.40. Sellers are aiming to challenge the 50% Fibonacci retracement at 1.3734, with a break below that exposing the 1.3673-81 area marked by the 61.8% level and the bottom of a Rising Wedge formation.
Alternatively, a reversal above the 1.3795-1.3810 region (38.2% Fib, trend line), targets the double top at 1.3932. Prices are too close to support to justify entering short in line with our long-term fundamental outlook from a risk/reward perspective. We will remain flat for now, waiting for a short trade setup to emerge.
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