5/31/2012 – Price action on EUR/USD (a daily chart of which is shown), as of 5/31/2012, has continued its extended fall that was initiated in the beginning of May and which has swiftly broken down below several key support levels. These levels include 1.3000 (also around the bottom of a clearly-defined triangle pattern), 1.2900, 1.2650 (approximately the 161.8% Fibonacci extension of the triangle’s widest span), and most recently, the key 1.2500 level. Currently, the extreme bearish momentum within the last month has brought price down to a 23-month low. With continued bearish momentum, price is now targeting a further downside support target around the 1.2150 price region, which is also the 261.8% Fibonacci extension of the triangle’s widest span. Upside resistance on any rebound/correction now resides around the broken 1.2500 price region.
(Chart courtesy of FXDD – Metatrader. Uptrend lines in green, downtrend lines in red, horizontal support/resistance lines in black, Fibonacci retracements in purple, 200-period simple moving average in blue, 100-period simple moving average in brown.)