EUR/USD (daily chart) as of March 4, 2013 has fallen to hit a major downside support target around 1.3000, which has been one of its key bearish objectives since the breakdown of the previous half-year uptrend that occurred in late February. This breakdown was triggered off of a major head-and-shoulders reversal pattern that brought price tumbling down from its early February high around the 1.3700 resistance handle, to break down below strong 1.3300 support and ultimately hit 1.3000 on Friday. Incidentally, GBP/USD has also hit its downside target of 1.5000 after an exceptionally steep bearish trend.
Currently stalled around 1.3000 support, EUR/USD continues to be in strong bearish mode after the trend-changing turn to the downside within the past month. With the head-and-shoulders price target close to being fulfilled, a further significant push below 1.3000 support would confirm a downtrend continuation and clear the way towards further downside objectives around 1.2800 and then 1.2650.
James Chen, CMT
Chief Technical Strategist
City Index Group
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