- 4H: Funny thing happened after I posted my video update yesterday. The EUR/USD looked like it was bottoming at previous low, and since the market was in consolidation mode, an early reversal signal in the 4H time-frame was spotted. (Refer to Daily Video Technical Update 2.18.2010). Before I completed processing and updating the video, the Fed announces a hike in the discount rate.
- The early reversal signal was quickly invalidated, by an aggressive bearish 4H candle.
- The stochastic rolled back into oversold zone, and the price action now threatens to break below the slightly declining channel.
- The market is overall bearish, so this break is more likely than not, but I want to give the bulls a chance to show what they have before settling on the continuation decline outlook.
- Daily: If there is no bullish attempt, an expansion of the previous wave down of 161.8% goes to the 78.6.% retracement area (1.30).
- A conservative target for the current breakout (if sustained), is the 1.33 area, or 138.2% expansion.
Fan Yang
Currency Analyst
Commodity Trading Advisor
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