EURUSD Jan 10th to Jan 14th Outlook
Recap of Last Week
Previous year close acted as resistance and a temporary higher high was immediately rejected. As mentioned last time, the breaking of the red zone pointed to a test of 1.30 area and that happened with no pullback at all. The week close at its low.
Next Week Outlook
Based on the range of the first week of the year in this pair, it is projecting many swings of 500 pips or more in this year. That represents many opportunities (and risk) in the coming weeks.
If euro holds the previous week low (yellow zone), a bounce towards the previous week midpoint (green zone) is in the card. The more important level, however, is that should a breakdown happen, the target is 100% downside expansion at 1.24 or lower (red zone, not visible on the chart). This target zone is good for the whole first quarter of 2011.