##{"id":58437,"date":"2011-07-12T10:20:33","date_gmt":"2011-07-12T00:20:33","guid":{"rendered":"http:\/\/www.fnarena.com\/index.php\/2011\/07\/12\/eurusd-big-move-lower-on-the-cards\/"},"modified":"2011-07-12T10:20:33","modified_gmt":"2011-07-12T00:20:33","slug":"eurusd-big-move-lower-on-the-cards","status":"publish","type":"post","link":"https:\/\/staging.fnarena.com\/index.php\/2011\/07\/12\/eurusd-big-move-lower-on-the-cards\/","title":{"rendered":"EURUSD: Big Move Lower On The Cards"},"content":{"rendered":"

\n\tBy Paul Robinson<\/p>\n

\n\tThe EURUSD<\/span> since mid-May has been undergoing a congestion phase after rallying strongly since the beginning of the year. Traders, according to SSI (Speculative Sentiment Index), had been bucking the rally throughout the entire duration of it. However, late last week sentiment for the first time since the end of 2010 began making an important shift. SSI now shows 65% of market participants to be net long. This flip in trader's views is especially important considering today's breakdown out of a 2-month triangle pattern. Interestingly, during this sideways price action implied volatility has been rising and daily travel ranges have been increasing. The 3-month volatility (V3M<\/span>) has risen from a low of 10.35 in April to today's reading of 13.36. An increase in volatility during sideways action is a sign of a pending move that is likely to be sizable.<\/p>\n

\n\tThe first target is the rising trend-line extending back to the 2010 low. There could be a confluence of technical levels as the 38.2% retracement<\/span> level from the low of 2010 sits near the rising trend-line. With this in mind, it will be important to watch how the EURUSD<\/span> reacts around this area of support – 1.3775-1.3825. The width of the triangle suggest an eventual measured move of ~1000 pips is in the cards, pointing to an intermediate-term target of 1.30-1.31, which coincides with the 61.8% retracement<\/span> level from the 2010 low and is just a stone's throw away from the 2011 low – 1.2873.<\/p>\n

\n\tThe combination of a key price break and the masses now leaning long provide an excellent opportunity to get on board a potential new trend. As we are all aware of, there are plenty of catalyst out of Europe which could fuel the move lower. If a strong trend develops there should be a plethora of short-term trading opportunities to take advantage of. So stay tuned…..<\/p>\n

\t $\"\"$
\n\tFor Additional Resources, Please Refer To: www.macro-trader.com<\/span><\/a><\/p>\n

\n\tThe views expressed are not FNArena's<\/span> (see our disclaimer).<\/p>\n

\n\tFor real time news and analysis, please visit http:\/\/www.dailyfx.com<\/span>\/real_time_news<\/p>\n

\n\tDailyFX<\/span> provides forex<\/span> news on the economic reports and political events that influence the currency market. Learn currency trading with a free practice account and charts from FXCM<\/span>.<\/p>\n

\n\twww.dailyfx.com<\/span><\/p>\n

\n\tDisclaimer<\/strong><\/em><\/p>\n

\n\tForex<\/span> Capital Markets is headquartered at Financial Square 32 Old Slip, 10th Floor, New York, NY 10005 USA.<\/u><\/em><\/p>\n

\n\tTrading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before you decide to trade the foreign exchange products offered by Forex<\/span> Capital Markets, LLC, Forex<\/span> Capital Markets Limited, inclusive of all EU branches, FXCM<\/span> Asia Limited, or FXCM<\/span> Australia Limited, any affiliates of aforementioned firms, or other firms under the FXCM<\/span> group of companies [collectively <\/em><\/p>\n

\n\tTechnical limitations<\/strong><\/p>\n

\n\tIf you are reading this story through a third party distribution channel and you cannot see charts included<\/span>, we apologise<\/em><\/span>, but technical limitations are to blame.<\/em><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"