Prices pulled back from resistance at a falling trend line set from May 2011 to test support at 1.2902, the 23.6% Fibonacci retracement. This barrier is reinforced by former resistance at the upper boundary of a rising channel set from the late-July swing bottom. A break downward initially targets the 38.2% retracement at 1.2737. Trend line resistance is now at 1.3142.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com
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