Yesterday, we said “the Euro has 2 choices, not 3: either it breaks 1.3509, or it collapses”, and indeed the Euro did break 1.3509 and reached our first suggested target 1.3589 successfully & accurately (the 2-day high for yesterday & today until the moment of preparing this report is 1.3594). Earlier yesterday, the Euro broke the support at 1.3448 and almost made it to our first suggested target 1.3368, but it stopped 12 pips before achieving this unique happening of reached the sell strategy target & the buy strategy target on the same day. Breaking 1.3509 is a solid confirmation of the righteousness of our medium term outlook. Last week, we had analyzed the medium-long term, and after doing all the necessary analysis using classical technical analysis, Elliot & Fibonacci, we found that most probably the first leg up from 1.1875 to 1.3332 is wave A of a 3-wave correction up. We also found that, most probably, the drop which followed is wave B, which stopped at Fibonacci 50% level of wave A with not-so-well kind of accuracy as it bottomed at 1.2586 whereas the Fibonacci level was 1.2604. If this move has stopped closer to the Fibonacci level, we would have expected this current rise from the first step it took around 1.26. So, currently, we are in wave C, which will ideally target the equality level (where wave A = wave C) which is at
1.4043, or the Fibonacci 61.8% level for the massive drop from 1.5143 to 1.1875 which is at 1.3895, or the top of the rising channel on the daily chart, which is currently at 1.3794 and will rise with time. This leaves the area between 1.3895 & 1.4043 as the proffered target area for this wave. We do believe we are heading there on in a matter of weeks. We expect to reach the target area by December, which is a month famous for introducing medium & long term tops for EURUSD. From there we could see the Euro collapsing and dropping to areas below 1.18, but it is too early to talk about this issue now, and we will leave the next stage discussion to a more appropriate time. Keep in mind that breaking 1.3509 confirms this analysis, and it supports the idea that we are heading to the target area suggested in the medium term analysis. Let’s talk short term now: resistance is at 1.3589, and if broken, we will target 1.3690 and then 1.3787. Short term support is at 1.3554, and if broken we expect a drop to 1.3461, and if broken to 1.3380.

Support:

• 1.3554: important intraday level.

• 1.3461: Fibonacci 61.8% for the rise from 1.3380.

• 1.3380: Yesterday’s low.

Resistance:

• 1.3589: Apr 1st & 2nd high.

• 1.3690: Apr 12th high.

• 1.3787: Feb 17th high.