The Euro continues to trade within a progressively narrower wedge formation against the US Dollar, and the next several days of price action will likely dictate Euro/US Dollar direction for the next several weeks of EUR/USD trading. Already we see the EUR/USD attempting yet another break to the topside after holding support overnight, and such a breakout would likely target previously stiff resistance at the 61.8 percent Fibonacci retracement of 1.3120-1.2390 move at 1.2840. Otherwise, subsequent support comes in at a triple-bottom in the 1.2330-1.2422 range.
The US Dollar/Japanese Yen has seemingly broken its wedge formation, and a dip below support at approximately 95.70 suggests that further short-term losses are likely. Next price floors come in at the important 61.8 percent Fibonacci retracement of the 90.90-100.50 move at 94.60, which likewise coincides with an intraday double-bottom from November 12. Previous trendline support has now become resistance, and the USD/JPY has shown difficulty climbing above 96.00. Our very short-term bearish bias remains intact as long as price remains below the pair’s falling trendline at approximately 97.00.
