FX.co ★ EUR/USD Intraday Technical Analysis and Trading Recommendations for December 26, 2012

The EUR/USD pair has been trending up within the depicted bullish channel having a strong move from 1.2650 towards 1.3300.

Price Level 1.3300 (psychological resistance) expressed quite significant bearish price action reflected in the last few daily candlesticks. However, it's not yet a sign of reversal, but just a reflection of a sideways consolidation, roughly between 1.33 and 1.3190.

The bullish momentum is lost in the 4H & 1H charts. Looking at the consolidation range again, note the middle is around 1.3245. Fixation below this zone can be a sign of bearish domination. However, a break above 1.3250 gives a bullish bias to the sideways consolidation.

If price fixates below 1.3180, it is probably indication of some bearish correction, may be rendered as a double top reversal pattern, which indicates a short-term correction.
Targets: The 4H chart shows the breakout projection towards 1.3080 area, but we have some key levels to be watched. Note that 50% Fibonacci retracement of December’s rally is at 1.3090.