EUR/USD to Test the 1.3135 Pivot; Failure to Break can Result in Head and Shoulders

by Admin

Awards 2013

EUR/USD 4H chart 9:41AM EDT 4/19/2013

EURUSD

Maintaining momentum: The EUR/USD continues to rally after finding support at 1.30. It is now above 1.31 and pushing toward a previous resistance pivot of 1.3135. Note that the RSI tagged 40 but held above, showing maintenance of the newly established bullish momentum in the 4H chart during April. A break above 1.3135 should open up 1.32 again. If the 4H RSI is pulled above 60, the EUR/USD has bullish continuation momentum.

Failure: If the market finds resistance against around 1.3135, and comes back below 1.3070 (The 4/19 US session low), it could be forming a head and shoulders pattern. In that scenario, we can look toward 50% retracement at 1.2973 and the 61.8% retracement at 1.2919 as potential targets/support.