This week we are focusing on a possible cycle low to continue the series of 7-week lows that began last October. A small doji candle yesterday formed at a cluster of Fibonacci retracements near 1.0326. This support and the expected cycle come as RSI is attempting to bounce off the 30 level; RSI at this level coincided with tradable lows in both July and November of 2012. (ch1) S/t, EUR has regained its down channel but prices remain below the next upside resistance at 1.3140 and the old 1.3170 level. A rally through 3140/70 will clear a path for a more important series of pivots at 1.3300 and possibly allow for the development of a right shoulder within a head & shoulders top. There is little support below 1.30 before 1.2875 which is the final Fibonacci retracement cluster and the December low. For today 1.3140/70 is the important resistance zone while 1.3040/20 marks key support. (ch2) Levels: Support – 1.3040, 1.3020, 1.2998 Resistance – 1.3140, 1.3170, 1.3300
Nomura