Last week review
A green candle that is mainly full (Marabuzu), with large body, is completing a candle pattern named “Morning star” and contains the last three candles. This is an attempt to sign that a new reality is possible in the next few weeks, during which the buyers will take charge to their hands and it is possible that the Euro will raise to the area between the 1.3241 and the 1.3625 price levels. Those levels are showing Fibonacci correction in size of between 38.2% and 61.8% of the last downtrend (red broken line). This is all possible in case the price establish itself above the 1.2910 resistance level. In case the price will stop at this level and go back under the 1.2580 price level, this assumption will cancel and the direction of the price will be south towards the 1.1877 target level.
Current review for today
Another “Marabuzu” candle in size of 300 pips completed a candle pattern called “Morning star” (reversal pattern- Usually works on low levels), breaking strongly the 1.2910 resistance level and actually putting the Euro on a new starting point in relation to the situation I was two weeks ago, when it looked like its crashing is inevitable. Breaking the 1.3241 price level which is a correction in size of a third of the last downtrend (red broken line) and it is possible to reach the 1.3433 price level (50% correction to the downtrend) at first stage and the two third correction level of the same downtrend on the 1.3625 price level on the second stage. In many cases a sharp move downwards is corrected by a third and continues its movement south. In this case the strength at the beginning of the correction move was so aggressive that it is possible in a high probability that we will see it goes above the third correction, meaning the 1.3241. A brake of the price on one of the mentioned correction levels will indicate the possibility for a correction in size of between a third and two thirds of the move upwards in first stage.
You can see the chart below: 