· Yesterday I have argued against chasing the CCY pair lower and highlighted the longer term setup and several buy signals on the longer term charts which suggest not to chase the CCY pair lower.
· Followed yesterday gap down not only did the CCY pair fill the gap but also rallied significantly ending in a daily bullish engulfing candle
· Support now is the 55dma at 1.1126 (pretty close to today's low) and then the rising channel support at 1.1030
· Again, the current structure could be a triangle pattern which is, in most cases, a continuation pattern.
· The top of the triangle is around 1.1440 and a re-test of this level seems likely
· Referring to the long term setups, similar structures on the longer term charts exist also on AUD/USD & GBP/USD which again warn against chasing the USD
From: Barry Lyss
Sent: Monday, June 29, 2015 9:49 AM
Subject: Tech View EUR/USD (1.1077 last) - don't chase the Euro lower, structure still looks corrective
Summary
· Only a daily close below 1.1030 would be bearish and argue for a move lower, this level represents the rising channel support and while above it a move higher is likely
· It is possible that the CCY pair is forming a triangle consolidation pattern, since this consolidation comes after a move higher it is by definition a continuation pattern and therefore is bullish
· Worth noting, the CCY pair also has several other buy signal on the weekly & monthly charts (demark buy signal) and therefor chasing the CCY lower at this point seems to have a poor risk/reward
Daily chart
Weekly chart
Summary