EUR-USD: We continue to see downside risk while the pair trades below its July 9/Feb. 1, 2010 lows at 1.3831/51 or even the 1.4025/28 levels, its Jan. 21, 2010 low/Feb. 3, 2010 high.
This suggests that as EUR-USD continues to hesitate at the 1.3733/47 levels, its June 16, 2009 low/.50 retracement (1.2328-1.5143 rally), we should look for it to trade lower toward the Feb. 8, 2010 low at 1.3620 followed by its 2010 low at 1.3584. A clean violation of the latter will resume its medium-term weakness toward its .61 Fib retracement/May 18, 2009 low at 1.3422/09 and then its June 3, 2009 low at 1.3211.
However, to reverse its immediate downside threats, the pair will have to decisively clear its July 9/Feb. 1, 2010 lows at 1.3831/51 to create scope for further strength toward the 1.4025/28 levels, its Jan. 21, 2010 low/Feb. 3, 2010 high where a cap is expected. On the whole, EUR remains biased to the downside medium term as long as it continues to hold below its key resistance the 1.4025/28 levels.
Mohammed Isah is a technical strategist and head of research at FXTechstrategy.com, a technical-research Web site. He has been trading and analyzing the foreign exchange market for the past seven years. He formerly traded stocks before crossing over to the forex market, where he worked for FXInstructor LLC as a technical analyst and head of research before joining FXTechstrategy.com. He has written extensively on the forex market and technical analysis and his articles have been featured in The Technical Analyst Magazine, The Forex Journal Magazine, The International Business Times and FXstreet.com. At FXTechstrategy.com, he writes daily, weekly and long-term technical commentaries on currencies and commodities, which are offered to its clients. He also produces
for his subscribers. He provides full coverage of the forex market with specific focus on G10 currencies as well as the commodities markets, with focus on five key commodities.