E$ underperformed expectation....

Hope all had a great weekend and I look forward to another exciting week before I fly away this coming Saturday for a mission trip and will be back on the 6th July.

Meantime, I have taken profit on my long E$ and A$ on Friday night and will stay aside for now since the currencies did not close as firm as I hoped to see. I will be monitoring XAU$ (closed firmer on Friday) and EURAUD for correlation.

E$ Daily chart

Update1: Indeed the weak close last week was the strongest message that the bulls were in trouble. I would have to scale back on my weekly bullishness of the E$, now that it has broken below the daily 21MA. Market has turned its focus to the EU Summit starting this Thursday.

Technically, short and longer term momentum are all pointing down but it has gone into o/s territory for now and we should see sideways consolidation to unwind the oversold condition before further selling kicks in. E$ looks vulnerable and may potentially fall towards 1.2340 quickly and I am even mentally prepared for a retest of recent low of 1.2288 in the days ahead.

It will take E$ to close above 1.2600 to invalidate the bearish view.

Immediate resistance stands at 1.2510/20 and stronger at 1.2550/60. All the best!