Today's Support and Resistance levels:

R3: 130.71

R2: 130.09

R1: 129.70

Current Spot: 129.05

S1: 128.64

S2: 128.37

S3: 127.90

Technical overview:

The rally of the 126.57 low has been very dynamic and the fact, that we have broken above the falling channel resistance line has forced us to make a slight change in our count. Now the most likely count is that we are in wave b towards 131.27 before the next downside pressure should be expected. We warned yesterday that the overlapping structure down from 129.90 could be either a leading diagonal or a correction of the 129.90 high and the impulsive rally indicates, that the decline of the 129.90 high was a red wave b correction. We are now looking for red wave c higher towards 131.27. Once this red wave c is finished we should expect a new powerful decline down to at least 124.96 again.

Trading recommendation:

We took a fresh new short position at 128.63, but our stop at 129.25 was quickly taken out. We will stand on the sideline for now and await a new EUR-selling opportunity at 131.15, where we sell EUR with a stop at 132.15.