Euro bulls have upper hand....

E$ remained well bid throughout yesterday's session with every dip meeting demand and closing Monday just off the high of 1.2900, forming an bullish engulfing candlestick. However, the resistance at 1.2900/10 proved to be formidable, at least for this round, as intraday indicator went into the o/b zone. Market is probably too quick to jump into the reversal story and this current sell-off should flush out the weak longs before it find first level of support around 1.2820/30 and stronger at 1.2780/900 for a rebound for the 1.2950-1.3000 area in the days ahead.

Europe order book:
Stop loss: 1.2750/35, 1.2905/15 and 1.2915/25
Limit: 1.2790/70

Primary trend: Bullish
Intermediate trend: Bullish
Minor trend: Bullish for initial target 1.3000

Technically, intraday indicators have come off its highs and still have room on the downside based on current level of 1.2864. Intraday oscillator indicator suggest range consolidation and at this moment a base is also in the making. Given a bullish engulfing candlestick pattern, one has to be cautious getting overly bearish when nearer the lower band of the range. Expected range 1.2820/30 to 1.2930/40. Risk/reward still favours buying on dips.

E$ 4hourly chart - Bullish price action....