Weekly Trend direction: Bearish
Weekly trend reversal level: 1.5145
Key G7 resistance levels: 1.4800, 1.4850, 1.4900, 1.4950
Counter-trend opportunities:
Strategy: Whilst below the weekly trend reversal level sell rallies to resistance levels after an entry signal.
Today's trade suggestion:
7 December:
Well, the jobs report sure got things going, this time – South, for the euro. We have performed a beautiful “bearish engulfing candle” with a “spike high” on the weekly chart, and this means that we’ll be looking to sell euros this week. Resistance levels are neatly defined above the current price, so it won’t be hard to pick the spot to enter. Watch and wait for a clear G7 reversal pattern before entering, remembering that these thin markets can lead to large retracements. Don’t enter too soon and don’t make assumptions. Key resistance lies either side of the 1.5000 area, with 1.4942 being the first, at the 38% Fibonacci zone. Whilst it’s hard not to be sceptical of last week’s reversal, year-end markets often present ideal technical trading opportunities and this week could provide an excellent opportunity to profit from the euro!
Update 10 December: Excellent opportunity it was, and the euro is still moving steadily (but not dramatically) downwards. Key resistance levels, starting at 1.4800, will provide areas to sell into during the rest of this week. Target for the shorts is 1.4620 and then 1.4500.
Summary:
Sell rallies to resistance levels (especially 1.4800/50 after a clear G7 entry signal, target 1.4620.
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