Euro and Pound Weekly Update - Jan.28 close

EURUSD

The Euro-Dollar broke the bullish daily trendline on Friday and the week ended on a pin bar closing at the weekly SMA100 and just above the 50% Fibonacci retracement on previous swing low, having reached the 61.8% retracement from where price experienced a rejection to the downside. Monday price action has recovered almost all of the fall and is presently trading near the previous highs for a retest of the break, and I would expect a continuation of the move towards the daily 38% Fibonacci retracement and SMA100 level down to the previously broken resistance level, now support at around 1.3450/90. On the weekly charts, and if the previous highs are surpassed, we could have a bullish run to the SMA200 at 1.3960, with a 127% extension on previous daily swing high near psychological level 1.4000.

GBPUSD

Still in consolidation though in a slightly lower range, the Pound-Dollar broke the daily bullish trend line to the downside to a 38.2% Fibonacci retracement and test of the broken descending channel, ending the week on a retest of the new line and still trading above the channel and support at 1.5860. We have a symmetrical triangle formation on the weekly time frame, with a slightly bullish expectation medium-term towards a retest of previous highs near 1.6300, with projection to a 127% Fibonacci extension and possibly further up to the weekly SMA200 and 138.2% extension (1.6850/1.7080). On daily, and provided the actual support holds, as we have seen today a strong rejection from the new bullish trend line level, presently trading a few pips above the previous highs at 1.6060, I would expect the price to break through and make a move to the 127% Fibonacci extension at around 1.6250.

EURGBP

The Euro-Pound had another bullish week but didn’t break above December 2010 highs and price was strongly rejected near the weekly SMA100. The daily descending channel was broken to the upside and started falling towards the 38.2% Fibonacci retracement and SMA100 level where it is presently trading after Monday close. I would expect a further fall to the daily SMA200/SMA34 in confluence and 50% retracement near 0.8460, which would correspond to the SMA34 level on the weekly time frame, from where I would expect a bounce back to the upside for a new attempt to break the previous highs and SMA100, and attain the upper line of the weekly symmetrical triangle formation.