Last week I told that I am not sure about EURO’s up move though it can go in the upside but as I indicated that it was in over-bought zone so it moved downward this week.
During last few months EURO is moving around a range so if it maintains that range then things will be same but I think this time EURO has more chance to drop below 1.30 support level, provided it does not break 1.32–1.33 level in early to middle of the coming week. To some extent it is in over-sold zone but still it has a chance to drop below 1.30, therefore it will trigger the bearish pattern and it can go up to1.25 range. So the chance of its long-term pattern which says that EURO will be around 1.15 is still alive.
Now if EURO does not break that level and maintain its range of 1.30 –1.35 then it will again try to test 1.34. But during last few months it was unable to break this 1.34 level, it looks really hard. So it will be better if we don’t talk about covering short positions but in case situation changes then investors who took short positions may think about covering their short positions if Euro goes level above 1.36.
[EURO is given against US dollar, unless specifically told.]
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