miroslava.micunkova's picture

Ten year uptrend-line in EURUSD gave way. Long-term targets point at parity and lower

EURUSD saw an all-time traded high at 1.6039 in July 2008 ahead of a major slump which retraced close to 50% of the 2001-2008 advance. Since then, EURUSD has produced a series of wide swings forming a sequence of lower tops throughout 2009-20014.

EURUSDJanuary2015.jpgTaking the bearish edge off such an indication were the rising lows on the opposite, when connected together, forming a 10 year slightly upwards slanting support line. On a large scale, such a formation may be classified as a symmetrical triangle, usually suggesting indecision of the next market direction.  

In January the sides seem to have been clearly taken by the winning bears.  The decisive break-down of a 10 year uptrend line signals a completion of a major bearish reversal triangle indicating further losses.

Our initial target in the coming months lies on a 1.2329-1.1881 (2008-2010) support-line at 1.0649 (falling by 0.0023 a month). Next conservative target, measured by the width of the triangle in its central niche and projected from the break-down level, points approximately at 0.9204.

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