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Friday, July 2, 2010
EUR/USD bullish momentum seems to be far from over, quite the contrary actually, it might have the 1.3100 area in its sights.
The pair's downtrend apparently reached its bottom, According to Axel Rudolph, Technical Analysis Research Team at commerzbank, "EUR/USD has probably not only ended a minor Elliott Wave abc correction at the late June 1.2151 low and broke above the April-to- July downtrend line at 1.2301 but has also risen and closed above the May 21st through June 21st neckline of an inverse head and shoulders pattern at 1.2412."
After moving on from the first Head and Shoulder pattern, Axel Rudolph indicates, "This engages the inverse head and shouldersupside target at 1.3120."
The near future expectations point to another go at the 1.2568 55-day moving average. Upon breaking this line, Rudolph anticipates it should "there is scope for the rally to extend towards the November-to-July downtrend line at 1.2782 in the first instance and the 1.30 region in the second instance."
The flip side of the coin could only be seen if "an unexpected drop below the 1.2150 late June low would void our bullish forecast."