21 Aug 2013
For EUR/USD bears, the line in the sand is right here right now!
FXstreet.com (Barcelona) - The EUR/USD rallied bullishly right up to and slightly beyond key resistance Tuesday as the lack of very meaningful data left traders and analysts to play off the technicals and speculation about Fed tapering.
EUR/USD on the verge of a huge breakout unless the bears step up
Can the EUR/USD really conquer this key “correction resistance” level at 1.3415? If the FOMC policy meeting minutes Wednesday and the tapering chatter likely to flow out of the Jackson Hole symposium Thursday and Friday allow for it – sure it can.
However, for that to happen means the big money players truly believe that the FOMC will lose their tapering backbone and succumb once again to the fear of the US economic recovery faltering. Not only do they have to believe that, but they simultaneously have to buy into the idea that European recovery rates will be greater than that of the US – and that the recovery will be sustained. As unlikely as this combination theory is, unless the EUR/USD bears hold their ground immediately, the masses exiting the EUR/USD short trade may make the perception seem like the reality.
Technical outlook for EUR/USD
Technicians point to 1.3414 – 1.3415 as potentially being a major bearish turning point for the EUR/USD. If they are correct, then a major move lower should commence shortly and will take the cross all the way down to approximately 1.2400 – 1.2500. If they are incorrect and the EUR/USD scores a breakout, the next upside target will be 1.3579. Short-term support comes in at the 1.33100 horizontal line.
EUR/USD on the verge of a huge breakout unless the bears step up
Can the EUR/USD really conquer this key “correction resistance” level at 1.3415? If the FOMC policy meeting minutes Wednesday and the tapering chatter likely to flow out of the Jackson Hole symposium Thursday and Friday allow for it – sure it can.
However, for that to happen means the big money players truly believe that the FOMC will lose their tapering backbone and succumb once again to the fear of the US economic recovery faltering. Not only do they have to believe that, but they simultaneously have to buy into the idea that European recovery rates will be greater than that of the US – and that the recovery will be sustained. As unlikely as this combination theory is, unless the EUR/USD bears hold their ground immediately, the masses exiting the EUR/USD short trade may make the perception seem like the reality.
Technical outlook for EUR/USD
Technicians point to 1.3414 – 1.3415 as potentially being a major bearish turning point for the EUR/USD. If they are correct, then a major move lower should commence shortly and will take the cross all the way down to approximately 1.2400 – 1.2500. If they are incorrect and the EUR/USD scores a breakout, the next upside target will be 1.3579. Short-term support comes in at the 1.33100 horizontal line.