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EURUSD: While the euro may have halted its corrective weakness and closed marginally higher the past week, it remains vulnerable to the downside nearer term.

Its Friday sell off reversing most of the weekly gains is suggestive of a return below the 1.4046 level, its May 16’2011 low with a break of that level calling for further weakness towards the 1.4020/00 levels, its mar 28’2011 low/psycho level.

Further down, the 1.3852 level comes in as the next downside target. Its weekly stochastic is bearish and pointing lower suggesting further weakness.

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Alternatively, on a violation of 1.4339 level and the 1.4422 level, further strength should build up towards its May 06’2011 high at 1.4586 and ultimately the 1.4938 level, its 2011 high.

All in all, though attempting a recovery, the pair remains vulnerable to the downside nearer term.