Today's Support and Resistance levels:
S1: 120.71 R1: 121.30
S2: 120.13 R2: 121.66
S3: 119.59 R3: 122.21
Technical overview:
Yesterday the powerful rally clearly showed us that we were looking at a wave iv correction and that one more new high was needed. We have already seen this new high with the test of 121.30, which is just two small pips above our ideal target. So we could have the top of wave 3 in place with the test of 121.30, but to confirm that we need a decline below 120.08, and more importantly a break below 119.25. That said we know we are getting close to the top of wave 3 if have not seen it already. However, as long as we have not seen a break below 120.08 we must accept the risk of a move a little higher towards the 121.66 - 121.77 area before the top is finally in place. What can we expect from the coming wave 4. The absolute minimum would be a 23.6% correction down to 116.35, while a more normal correction would take us down to the 38.2% corrective target at 113.29. Time will show us which target is the correct one.
Trading кecommedation:
We will sell EUR here at 120.85 with a 122.35 stop and take half profit at 116.50 and half profit at 113.75.