EUR/USD fractal outlook

[Paul Koszarny]

The reversal from 1.1110 has accelerated and now its basic support comes at 1.1444. As long as we stay above it, the momentum will not slow down much. For the new week 1.1668 could be an excellent target for longs and a good selling level. Key importance I would give the first two sessions, and particularly to Tuesday, the nearest model day. It coincides with the same day on gold charts and gold has been climbing higher. It is therefore possible that a new local extreme will develop then. Last week Tuesday was also important, however it was just a meagre dark candle with an opportunity to set a long position rather than trying to go short. Tuesday did not turn out to be a session where good selling levels would have triggered. I tried to go short unsuccessfully the next day and was stopped at 1.1445. Wednesday lost its fractal properties for long hours which I attribute to big names involved in something that nearly resembles central banks' interventions. Most certainly FED would never admit to alleged insider activity. It is interesting that USD/JPY did not show much selling pressure so the tag of war which is going on pertains to the US-eurozone. The last two sessions of the week regained fractal properties. The so called free market was given back to smaller names to see their reaction and to give them some time to lick their wounds. However, hourlies were still full of traps set by the operators who were looking for stops. Standard stop losses broke like matchsticks as the market was generally not very liquid then. For the current wave 1.1110-1.1554 the first Fibo retracement comes at 1.1397. Should EUR/USD make it, the up trend may significantly slow down. It needs to be noted that Friday's high 1.1554 was exactly the then fractal resistance and no wonder that the market plummeted 60 pips within a very short time. I would look for some opportunities near the model hours which for Monday come at 9:00 and 16:00 CET.