EUR/USD 1H Chart 10/10/2012 11:40AM EDT
Pullback to 1.29: This week we saw the EUR/USD fall below 1.30, then react to it as resistance, and finally fall under 1.29 during 10/9 session. The 10/10 session is so far one of consolidation, with a bit of correction back toward the 1.29 handle. The 1H chart shows that around 1.29, there is a new declining trendline started from Friday (10/5). Also, the RSI is near 60. If this short-term bear-trend is to continue, it should under 1.29 and the trendline, with the RSI holding under 60.
Support factors: The 4H chart shows that there is more downside risk for a swing projection, which targets 1.2707. However there is a support/resistance pivot at 1.2750. Even above that, maybe even above 1.28, the market will be challenged by a key rising trendline that goes back to the 1.2042 low in July.
Technical crossroad: So bearish momentum is there in the near-term, but space is limited to the downside before it gets to major support factors. On the other hand, only a break back above 1.30 should re-introduce any bullish continuation outlook, but that outlook is also limited to the previous high of 1.3170, where it is likely to meet a major falling trendline going back to the 1.4940 high on May, 2011.
EUR/USD 4H Chart 10/10/2012 11:45AM EDT