EUR/USD bulls, shame on you!
You can’t cover 23,6 fibo return from the 1.40 –>1.11 fall!? 🙂 The fall began in early May 2014. from 1.3393 and temporary find the bottom in the middle of January at 1.1097. After four weeks, EUR/USD can’t cover 23,6 loss, which is at 1.1777. On the way up, there is daily resistance at 1.1430/50, next is weekly at 1.1530/50, following 1.1660/80 and 23,6 fibo at 1.1777! Long way, can it be done by the euro bulls, or we could see another decline toward 1.1100? First minnor support at 1.1370/80, following stronger at 1.1260/70 and previous low 1.1100!
What is quite interesting is that January’s high was 1.20992 and the 382 Fib Level comes in at 1.22036 which is 104.4 pips higher. Thus in essence what is being said is that there must be a complete retracement of the whole of the January drop. The low made on 26th January 2015 was 1.10971 giving a monthly range of 1,002.1 pips which by any standards is massive. The current low for this month is 1.12702 made on the 9th February 2015. Thus to get the 382 Fib Level the monthly range for February will have to be 829.0 pips which is still massive.Whilst I am not saying that the price action will retrace or possibly will not retrace to 382 Fib Level, I do think that there ought to be consideration of the prospective of the size of the figures involved. What also is quite interesting is the daily ATR (14 period). the current reading is 119.4 pips which is a fairly standard level. During the early part of January it dropped to 80.8 pips before moving to a high of 169.1 pips during the first two weeks of this month. Personally I think we will see a drop in the ATR to the 80s level and the price action will move towards 382 Fib Level. This will be precipitated by the Dollar longs slowly giving up their positions as it becomes more and more obvious that the FED will not be putting up interest rates any time soon. However there is Yellen’s testimony which may surprise us all with the June rate hike becoming a certainty rather than a relatively remote chance having seen the minutes of the last FOMC meeting. So in summary the bulls have taken a real beating and it may take them time to recover their strength.
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