EURUSD - 1.2150 pivotal.

Yesterday produced some strong contra moves, in relation to recent price action. However, this is only one days price action, and it barely puts a dent in the bigger picture's overall bearishness. If anything, it may prove to be part of a healthy correction which recharges the bears. However, I favour some more corrective activity in the meantime, though admittedly this goes against the grain and given the recent high volatility, I doubt it would unfold in a trader-friendly manor.

The EURUSD finds itself at an interesting juncture after yesterday's move. The breakdown of last Friday's losses was around 1.2150, and thus far this has held as firm resistance on 2 attempts over the past 24 hours. - For me this is likely to be the pivotal area as to whether the EURUSD makes a deeper correction. In the meantime I will post 2 EURUSD charts, the first chart shows 2 converging trendlines. These are not fitted lines, but lines which were previously drawn. The red line was originally drawn a couple of months ago, and the green line more recently. With the exception of a couple of minor intraday breaches, both have pretty much contained the price action. However yesterday's strong upmove managed to close above the declining green line, which has prompted me to take a small ,though slightly nervy, long position. I have also emphasised the bullish divergence on this daily chart. - The second chart is the EUR daily with the 15 & 40 day SMAs. The 15-day SMA has pretty much contained the daily close throughout the more aggressive downtrend since last April, the 40-day SMA has largely defined the entire downtrend with one small breach mid-April. If the EURUSD can close over the 15day SMA around 1.2170 currently, then this would shift the odds in favour of a deeper correction, perhaps towards the 40-day SMA around 1.26ish.