Technical summary:
The rally from a low of 1.3880 continued to unfold as a textbook impulsive rally. We have seen the expected correction lower towards 1.4208, which is expected to protect the downside for the next impulsive rally higher to just above 1.4547 in red wave v, this should terminate the first larger impulsive wave i and call for a deeper correction of the entire rally from 1.3880.
In the short term, we are going to be looking for a break above minor resistance at 1.4277 and more importantly a break above resistance at 1.4321 as indication that red wave v higher to 1.4547 is developing.
Trading recommendation:
We are long EUR from 1.4055 and will keep our stop at 1.4100 for now. Buy EUR near 1.4208 with the same stop at 1.4100, but upon a break above 1.4321 move the stop higher to 10 pips below the most recent bottom.
The material has been provided by InstaForex Company - www.instaforex.com