FORX CYCLE :
EURUSD formed a cycle bottom at 1.3837 on daily chart. Further rise is still possible next week, and next target would be at 1.4600-1.4700 area. Support is at 1.4250, only break below this level will suggest that a cycle top is being formed, then another fall to test 1.3837 support could be seen.
For long term analysis, EURUSD is in consolidation of uptrend from 1.1876 (2010 low). Range trading between 1.3837 and 1.4939 is expected in next several weeks.
ACTION FOREX :
EUR/USD's rise from 1.3837 extended further to as high as 1.4437 last week but should have formed a temporary top there an retreated. Initial bias is neutral this week for some consolidations but another rise will remain mildly in favor as long as 1.4138 support holds. Focus is now on 1.4577 resistance. Decisive break there will indicate that correction pattern from 1.4939 has completed with three waves down to 1.3837. In such case, the larger up trend is likely resuming for 1.5 and beyond. Break of 1.4138 will in turn suggest that rebound from 1.3837 has completed and will turn bias back to the downside for this support instead.
In the bigger picture, EUR/USD is still trading above medium term trend line support from 1.1875 (now at 1.3793) and thus, rise from there should still be in progress. We'd continue to favor the bullish case that correction from 1.6039 has completed with three waves down to 1.1875 already and above 1.4939 will target 1.5143 resistance first. Break will affirm the bullish case of long term up trend resumption for another high above 1.6039. However, sustained trading below the mentioned trend line support will indicate that there should at least be one more medium term decline, possibly for below 1.1875, before correction from 1.6039 completes.
In the long term picture, correction from 1.6039 might have completed at 1.1875 already. Meanwhile, up trend from 2000 low of 0.8223 might be resuming. Break of 1.5143 resistance will affirm this case and should pave the wave through 2008 high of 1.6039 to 61.8% projection of 0.8223 to 1.6039 from 1.1875 at 1.6705.
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