Stunningly, the Euro stopped exactly & down to the pip at our suggested resistance in yesterday’s report 1.3118, to confirm the importance of this level, which will live to see itself as our resistance for one more day. The Euro had penetrated 1.3047 on Thursday, and jumped strongly, reaching the first suggested target for this break 1.3145, it stopped there, and dropped from Friday high which was 1.3157, sharply. We have abandoned our negative outlook after the penetration of 1.3047, but it seems that the Euro has failed at the first serious test after that. The price has stopped at the retest level of the rising trend line from the June 7th low (please refer to the attached chart), and then left us with a (Shooting Star) candle pattern. Therefore, the technical outlook, even after penetrating 1.3047, is not strong enough to consider the Euro a “buy”, after failing in the retest. Short term resistance is at 1.3118, and only if broken will the Euro have another chance to rise. If it does break this level targets will be 1.3194 & 1.3306. On the other hand, the support is at 1.3056, and if broken, we will head towards the Fibonacci retracement levels for the whole rise from 1.2643 to Friday’s high. The first two of these levels are 1.2961 & 1.2900.

Support:

• 1.3056: the rising trend line combining Wednesday’s, Thursday’s & yesterday’s lows, on the hourly chart.

• 1.2961: Fibonacci 38.2% for the rise from 1.2643.

• 1.2900: Fibonacci 50% for the rise from 1.2643.

Resistance:

• 1.3118: Yesterday’s high, Aug 5th low.

• 1.3194: Aug 2th high.

• 1.3306: Aug 9th high.