To start 2016 EURUSD tested for the third time a short term that emerged off of the first significant pull back from the massive rise at the beginning of December 2015, the 1.08 level. This time the level gave way and was broken, it presented itself as a good short term selling opportunity however the sells were cut off soon thereafter as price stalled at 1.07 and then began to make a dramatic rise to finish the week off above 1.09. The reason this is first significant is because in order for the bears to have major success within a down trend, holding broken supports as a new resistance is a key founding property. Second reason is that EURUSD managed to create a weekly candle that will provide significant momentum to the EURUSD Bulls.
EURUSD closed just under the key technical level to confirm another rise. Look for Monday or early next week to provide a close, then look for a retest of that level (likely to be around 1.0940) before we continue moving up. Please note that the overall is resting in the 1.1050 area...expect this area also to act as resistance. Be quick to identify the consolidation in this area (if any) and then proceed with a potential long on a break of that as well.
Overall Targets for EURUSD as we move throughout January is going to be between 1.1225-1.1300...These levels are derived by identifying the current strength of the particular market and then applying the strength channel. From 105 to target level areas the market will have completed an patten as well so we may see strength after a finished rise to 1.13 zone.
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