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25 Feb 2013
Forex Flash:Price action pushes EUR through ECB uptrend - BBH
Marc Chandler, Global Head of Currency Strategy at Brown Brothers Harriman notes that the recent price action has pushed the single currency through the uptrend that has been in place since ECB's Draghi unequivocally committed to doing what is necessary to save the monetary union in late July last year.
He notes that the trendline came in near 1.3220 and the Euro has now made two consecutive closes below it. He writes, “We should be looking at retracement objectives of that large move. The first retracement objective is near 1.3070; the 50% near 1.2880 and the 61.8% near 1.2680.” He continues to highlight that the last phase of the Euro´s advance began in mid-November and the 1.3070 area also corresponds to 61.8% of that move. Chandler finishes by writing, “In addition, there is a potential topping pattern in the euro that has been carved out over the past month that projects a bit below $1.2900. On the upside, resistance in the $1.3250-$1.3300 area should cap corrective upticks.”
He notes that the trendline came in near 1.3220 and the Euro has now made two consecutive closes below it. He writes, “We should be looking at retracement objectives of that large move. The first retracement objective is near 1.3070; the 50% near 1.2880 and the 61.8% near 1.2680.” He continues to highlight that the last phase of the Euro´s advance began in mid-November and the 1.3070 area also corresponds to 61.8% of that move. Chandler finishes by writing, “In addition, there is a potential topping pattern in the euro that has been carved out over the past month that projects a bit below $1.2900. On the upside, resistance in the $1.3250-$1.3300 area should cap corrective upticks.”