EURUSD weekly - Rallies to be sold; 1.1988 targeted

After the previous week's indecisive lack of movement, the majority of last week's price action showed the same trendlessness. Despite higher lows being posted in each of the first four days the market's upside progress was exceptionally limited. This suggested an underlying weakness that was confirmed by renewed selling on Friday – a move that took EURUSD to the lowest levels traded since June 2010. There is a likelihood that this week will begin with some profit taking but we look for rallies to be temporary and limited and so in view of this our call is Bearish and to sell any early rally to 1.2219. The risk is 1.2284. The immediate objective is 1.2049 and a move through that point should see the market focusing on  1.1988 or even towards 1.1876, the 2010 base.
The risk is that selling pressure was more temporary than currently assessed and this would be confirmed by a move up through 1.2284, Friday’s top. Further gains would then target 1.2340.half the net fall from July 6, then 1.2434, a 38 percent recovery of the decline from three weeks ago.