The Euro traded close to the top end of the 2-month 1.3675/3510 range yesterday. We view this range as a bearish consolidation of the decline from 1.40; that in itself was a resolution of a long-term bearish wedge. Prices rallied over the last 2-weeks in choppy corrective fashion so we’d look for a break of the 2-week up channel to signal a move back to the recent lows. From an Elliott perspective the rally shows two corrective patterns, the first is an a-b-c flat, the second is an a-b-c zig zag (note the b-wave triangle as well). For today, a break of pivot and channel support at 1.36 will promote a more robust move lower with the next support level surfacing at 1.3565. Key resistance for this outlook is 1.3626. Conviction: Med Levels: Support –1.3600, 1.3584, 1.3565 Resistance – 1.3626, 1.3641, 1.3651
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