As i sit watching the EURUSD( Tuesday 22 Nov Lunchtime euro time/pre US data) I am begining to think that price is making very heavy weather since yesterday when we saw support at 1.3450 and the chart formation is (at least in the 15/30 and 60 min TF's) a healthy bottom with repeated attempts to penetrate below 1.3420 being frustrated . Now we find ourselves just above the 1.3540 area and i am begining to get nervous and am staring a repeated centre line failure in the face.. Price has a basic ML/centre line objective of over 1.36 and at a sharp angle which looks too high without an enormous burst of energy. I was certainly expecting to see higher prices but now am worried. I have long since given up trying to rationalise the fundamentals behind the Euro crisis and this is in part because this is not a purely financial problem but a political problem. In a perfect world that reflected(my personal) true value then EurUsd should be languishing somewhere around 1.30 to 1.31 but doubts are now turning from Europe to the US and their budget issues and the Euro seems to be drawing a long breath before we see a new trend....or of course a continuation down to a level where every fibre of my body tells me we should be at.
We are stuck in a band/group of up sloping reaction lines that emanate from monthly forks ( you can draw them yourself). These reaction lines can be directly attributed to the current range. If you look in a high time frame the trend is down and we have held firm at the .75 Fib RT level but are in a fib dance between the .618 and the .75. I do not trade using Fibs but always check the retracements for additional confirmation or in this case a flag which tells me "Beware"! The following forks are of special interest as are their reaction lines
Fork 1: 1.2520 4th March 2009,1.5143 25 Nov 2009, 1.1875 4th June 2010 ( these may be slightly approximated btu are un-missible pivots)
Fork 2: Using the same P1 and P2 then use a P0 by using the lower low of 1.2333 on 27th Ocotber 2008
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