On the EURUSD, the price defended the lower line of the wedge formation (green lines). Wedge generally suggests that the price will decline in the long-term but this defence (yellow) gives buyers hope and an occasion for the mid-term upswing. The closest target for now is 100 pips away (orange, 1.085) and looks very strong. It is a combination of the horizontal resistance and the long-term down trendline (blue). This allows us to think that this resistance will be very hard to break.
Long-term sentiment has to stay negative for a while. We are below all major resistances so we have no grounds to think that the situation is different. We can see a bullish potential in the short-term and this is our base scenario for the next few days/weeks. USD weakness should be continued but again, later on, higher prices on the EURUSD will be used by the sellers to push prices lower.
Tomasz Wisniewski
Chief Analyst – Alpari Research & Analysis Limited
http://www.alpari.news
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