The EUR/USD pair had a bullish session for the Monday trading day, but it did manage to give up quite a bit of its gains in the end. The 1.2350 level continues to hold as resistance, and as such we think that selling this pair may be possible even in these prices.
Should also be noted that the pair is forming a rising wedge, and that is normally a bearish sign. We would become aggressively short of this pair if we manage to break the lows from the Monday session, and especially so if we manage to break the lows of the Friday session as it would not only show a break of a rising wedge, but also the support that we found at the 1.2250 level area.
As for buying the Euro, we see absolutely no reason to do so as the Europeans are still dawdling when it comes to the financial crisis. In fact, we think that 1.25 will simply be far too extremely resistive for the pair to rise above it. We are looking for rallies to sell, or even a breakdown as mentioned above to do so as well.
Written by FX Empire