Our outlook for the euro remains that of corrective to consolidation with upside risk seen towards its June 1, 2010 high at 1.2353.
A decisive cut through there will clear the way for a run at the 1.2451 level, its May 28, 2010 high and next its May 21, 20100 high at 1.2671. This view remains valid while the euro continues to trade above the 1.2000/1.1875 zone.
Its daily studies, which are bullish and pointing higher, are supportive of this view. Alternatively, a break and hold below the 1.1875 level, the 2010 low will have to occur to annul its corrective recovery view and bring further weakness towards its January, 2006 low at 1.1801.
A violation of there will open the door for further weakness towards its major support at 1.1640 established in 2005. All in all, having triggered a corrective recovery, the pair now looks to build on those gains towards the 1.2353/1.2451 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.