EUR/USD Confirming Top after Pullback

\ 8:09 AM EST \ January 16th, 2013
Forex Technical Update

EUR/USD 1H chart 8:00AM EST 1/16/2013

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Top, pullback: The EUR/USD broke below a triangle in a topping attempt during the 1/15 US session. The top was established when it slid below 1.3320-1.3332 support area. It has yet to test the 1.3248, 38.2% retracement and the 1.3244 support pivot before a pullback. As we begin the 1/16 US session, we see that the pullback respecting the 1.3320 level as resistance. This adds to the bearish bias as it shows that the top is set. A break above 1.3350 however would make the top suspect.

Targets: You can’t really call this decline a trend yet. It should be considered a correction for now. The 1H RSI hasn’t even tagged 30, which means bearish momentum is still weak. If price can push below the mentioned support at 1.3244-1.3248, it opens up 1.32, 50% retracement down to 61.8% retracement at 1.3152. There is also a 200-hour SMA in between those fibonacci retracement levels. A break below 1.3150 could be a key development that opens up even further bearish outlook. It was the support from a previous consolidation area during the second half of  Dec. 2012.

Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes – provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.

Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.

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