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Paul Koszarny · 13-04-2003, 19:07

EUR/USD fractal outlook

EUR/USD continues sliding downwards moderately. After 1.0555-1.0830 movement from Monday to Thursday which retraced 61.8% of 1.0955-1.0555, we saw quite a fast correcting wave. EUR/USD touched a low 1.0692 and short covering lifted the pair to 1.0755. It should be a textbook exercise for anyone who challenges Fibonacci with spaghetti numbers as the precision of the real market performance is really remarkable now. Great for technicians but upsetting for fundamentalists who prefer short stories of various authorities. Last week’s close below resistance 1.0758 looks negative. Fast moving averages on weekly charts are still in a cluster, suggesting a strong movement ahead in the system. Since we have not had such, the question is how much up or how much down EUR/USD could move, especially when volatility is far from disappointing any trader. Some indications should be seen from major bourses which had a spectacular Monday in a very distributive mode on its peak and then falls of indices prevailed all across the board. From the model point of view EUR/USD posted a local high near the fractal day and it implies further movement south until the next fractal day. Although last week I indicated Friday, it was valid for a low whereas a local high calls for a shift of the model day to Thursday. Thus we should concentrate attention on Tuesday for a local high and Friday for a local low in the new week. Friday seems more significant of the two. The sharp reaction from 1.0555 on Monday highlights support from 1.0576 until 1.0601. Immediate resistance comes near 1.0758, followed by 1.0799. I will welcome EUR/USD moving lower, though exuberance in any direction will be used for contrarian trades and I rarely take risks of making a guess which way to go. The nearest model hour is at 11:00CET. On Tokyo hours the only important spot is at 3:00-4:00CET with hourly support 1.0693. It is possible that from midday Europe we will be having one direction until the close of NYSE.

13-04-2003, 19:07	#1 (permalink)
Paul Koszarny Super Moderator Join Date: Nov 2002 Posts: 322 Rep Power: 0	EUR/USD fractal outlook EUR/USD fractal outlook EUR/USD continues sliding downwards moderately. After 1.0555-1.0830 movement from Monday to Thursday which retraced 61.8% of 1.0955-1.0555, we saw quite a fast correcting wave. EUR/USD touched a low 1.0692 and short covering lifted the pair to 1.0755. It should be a textbook exercise for anyone who challenges Fibonacci with spaghetti numbers as the precision of the real market performance is really remarkable now. Great for technicians but upsetting for fundamentalists who prefer short stories of various authorities. Last week’s close below resistance 1.0758 looks negative. Fast moving averages on weekly charts are still in a cluster, suggesting a strong movement ahead in the system. Since we have not had such, the question is how much up or how much down EUR/USD could move, especially when volatility is far from disappointing any trader. Some indications should be seen from major bourses which had a spectacular Monday in a very distributive mode on its peak and then falls of indices prevailed all across the board. From the model point of view EUR/USD posted a local high near the fractal day and it implies further movement south until the next fractal day. Although last week I indicated Friday, it was valid for a low whereas a local high calls for a shift of the model day to Thursday. Thus we should concentrate attention on Tuesday for a local high and Friday for a local low in the new week. Friday seems more significant of the two. The sharp reaction from 1.0555 on Monday highlights support from 1.0576 until 1.0601. Immediate resistance comes near 1.0758, followed by 1.0799. I will welcome EUR/USD moving lower, though exuberance in any direction will be used for contrarian trades and I rarely take risks of making a guess which way to go. The nearest model hour is at 11:00CET. On Tokyo hours the only important spot is at 3:00-4:00CET with hourly support 1.0693. It is possible that from midday Europe we will be having one direction until the close of NYSE.