In my update titled "Eyes on Bernanke..." (22 May 13), my target of 1.34/35 for the intermediate trend has been achieved and E$ should now be due for a correction lower whereas the greenback will take centre stage once again. In yesterday's brief update, my target of 1.3250 has also been hit and E$'s next target could be 1.3100/20.
Europe order book:
Stop loss: 1.3150 and 1.3416/17
Limit: 1.3150 and 1.3400
Primary trend: Bullish
Intermediate trend: Range between 1.2800 to 1.3400
Minor trend: Bearish
Technically, shorter intraday indicator has gone into extreme o/s level but the longer one still has abit more room for further downside. Shorter intraday momentum indicator is starting to show a slowdown in the rate of selling though the longer one is still pointing firmly lower. In view of this conflicting signal, one cannot get overly bearish when E$ nears the 1.3160/80 band (on first test) for this round. At this stage (low so far 1.3193), I would expect E$ to attempt another low before a mild rebound towards 1.3250/60. I would look to fade into the rally but that should be held back till tomorrow.
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| E$ 8hourly chart - E$ to retrace from recent rally |
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