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EUR/USD: London session may see breakout of 1.29 - 2ndSkies

FXStreet (Bali) - Chris Capre, Founder at 2ndSkies, suspects that after the breakout of 1.30/31 level in EUR/USD, the hours the rate may be maintained above 1.2900 are numbered, noting that a break may be seen in the upcoming London session, and ahead of the US NFP report.

Key Quotes

"Already in a downtrend, the Euro today got bloodied every which way and loose from the ECB policy meeting today, losing over 200 pips on the day from open to close. We talked about the bearish bias and what would happen if the 1.3100 level fell in our weekly market commentary."

"That day has come so where to from here? The next layer of support doesn't come till 1.2833 and 1.27 (April-July 2013 lows). I'm leaning towards the latter of the two before bulls even consider stepping in. Although we can obviously look for pullbacks into resistance to get short, with the close near the lows, I'm suspecting a breakout of 1.2900 in the upcoming London session."

"Hence watch for a price action squeeze on the intra-day 4hr/1hr/5m charts to get short gunning for the downside targets. Only aggressive buying in early London would tell me to sell higher up on pullbacks towards 1.3100."

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