An extremely quiet day in New York saw EUR/USD chop around between 1.2575 and 1.2615. EUR/JPY threatened a breakdown at 143.65 from a large Head and Shoulders pattern, but never got the momentum up to take the plunge.

Our EUR/USD target remains corrective wave A low at Fib support zone 1.2520. Elliott Wave Theory instructs us that corrective patterns ideally find support from 4th waves of one smaller degree, which again is in the 1.2520 area from the 5 wave upmove labeled in black, Roman numerals. From there, value longs and short- and medium-term short sellers should be begin bidding the market reversing trend back up for one more doomed lower high to Wave B. And that's where the real selling could begin.

For tonight, some readers could be coming into the Asian open either short EUR/USD or flat, and either is fine, but the key level tonight will be Fib support 1.2520. If you're short EUR/USD from ANYWHERE, get ready to buy them back, and if you're flat EUR/USD, get ready to buy them outright. We will be leaving resting bids at 1.2525, with stops under 1.2500, and initial limits to take profit at the New York lows of 1.2560.

Todd Gordon is a Technical Currency Strategist and Fund Trader with GAIN Capital Group.

Disclaimer
The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.