Sell the Euro on Near-Term Rallies

03/23/2010 12:01 am EST

Focus: FOREX

Jamie Saettele

Senior Technical Strategist, FXCM

The EUR/USD decline from 13822 has extended below 13530 and is sharp. Expectations are for a small second wave to bring price back to resistance at 13550-13585.


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The fourth wave correction in the EUR/USD is likely complete. The top is close to parallel channel resistance as well as the 38.2% retracement of the decline from 14583 (common end points for fourth waves).

As noted, the decline from 13822 has extended below 13530 and is sharp. Expectations are for a small second wave to bring price back to resistance at 13550-13585.

A rally presents an opportunity to short against the larger fourth wave high in anticipation of a break to a 2010 low and an extended decline into the low 12000s.

Jamie Saettele of DailyFX.com

DailyFX provides forex news on the economic reports and political events that influence the currency market.