In yesterday’s commentary we discussed the Euro falling to 1.4600 and below that there could be sharp reactions back to the upside, especially at 1.4500.   During the full trading day the Euro fell 180+ pips creating fresh 6 month lows then reports of a Hurricane took over driving Oil up by $5 – which drives down the buck.   We don’t usually talk about indicators but the DeMark is oversold and the stochastics are making another bear move to find a bottom and bring back some bulls.   Markets are a little shaky in the Euro zone so the bull move is not expected to be very significant; rather a correction before another bout of consolidation.   The area which to be tested to the upside is the previous support, turned resistance, of 1.53xx.

The pound is also oversold when looking at the indicators.   The overall bear run is following Fibonacci price targets quite well too.   The next level is 1.8210 after which 1.8425 has been achieved, if there is another bear run.   After this there is usually some consolidation or sharp reactions to the opposite direction.   The resistance level from the current zone could be 1.8550, if the bulls decide to do something.

The USD is sill failing to break above 110.50.   Where are the Bears at? What will break first, 110.50 or 108.3?   If 110.5, then 113.35 (61.8% fib) could be the big target.   If 108.3, then 107.20 in the short term until the channel is broken.