Prices took out support at 1.2830, the 23.6% Fibonacci expansion level, after completing a bearish Three Inside Down candlestick pattern below falling trend line resistance set from May 2011. Sellers are now testing the 1.27 figure, with a break below that aiming to challenge the 38.2% Fib at 1.2619. The 1.2826 level has been recast as resistance, with a push back above that exposing trend line support-turned-resistance at 1.2930. We continue to hold short.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com
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