Howdy!!Again the dollar fell to a new record low level against the euro at 1.3851, on fears that problems in the U.S. subprime loan market will spread to the wider economy. Hmmm...do you guys understand that?? Ok, let's focus on technical analysis, shall we?
Longer term, the euro remains bullish, but I believe a short-term correction is building up. I see a rising wedge (a bearish sign) on the 4H chart, note too that technicals are not confirming the recent gains. And I see a bearish divergence on 4H chart, while sentiment is widely bullish which might be the kiss of death for the euro, albeit short-term only. However, there are still no signs that a top is in place and therefore still too early and risky to short.
Today's Pivot Points:
R2 = 1.3878
R1 = 1.3852
PP = 1.3823
S1 = 1.3797
S2 = 1.3768
Monday's Calendar:
1- US Existing Home Sales 10.00 pm
Monday's Strategy:
1- Buy euro on dips, 1.3790, 1.3770 are good long entry level.
3- Sell euro on peaks, 1.3840, 1.3820 are good short entry level.
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