Good morning,
Sorry for the late comment, but my ideas are quite split on what's going to happen next.
The price action as of my latest comment was quite messy as I said and it didn't really fell like we
were going to break much higher on the upside. Since then we have seen a nice retreat of EURUSD to the downside, with no massive news of importance that would justify such a move.
We have the G20 communique scheduled to be released tomorrow morning and FED FOMC statement on QE2 to be released next wednesday. These two events will generate a lot of volatility not only by their outcome past-comments, but also before since we will assist to a lot of position adjustments due to risk reduction.
I am hearing that smart money (ie Reserve Managers like China and Korea) buying the dip in EURUSD but at mom it trades quite weak.
Overall I would be tempted to fade the extremes, since we will only know the first important of the outcomes tomorrow. My first levels of importance on the downside are 1.3860-70 that we held 1/2 hour ago and 1.3825-30. On the topside 1.3950 ish.
I ll let you if I have a strong idea worth trading later on as the day evolves.
Good trading
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