Commentary By Peter Wadkins of ThomsonReuters/DailyFXPlus

DailyFX - Plus: 16:12 EUR/USD: Bad Omen For Bull Trend New York, March 27th.

As we have noted many times in this column, a strong trend should open the week and close the week in the direction of the trend, the middle should be backing and filling. Today's EUR/USD collapse belies that, and even with the cycle gurus looking for a currency top in 'the next few days' there is a distinct feeling to this market that their initial call for a March 23rd week peak was the prescient one. The cycle gurus tell us another EUR/USD bounce is on the way, the week of April 20th (originally Easter week, April 13th) and then a pronounced strong USD uptrend.

They also cautioned 'supports at 1.3300 (EUR/USD), 1.1400 (USD/CHF) and 1.4200 (GBP/USD) must hold on a closing basis if our positive outlook is correct. If these levels give way then these currencies are headed directly lower into July'. EUR/USD is at 1.3295/00, USD/CHF 1.1440, and GBP/USD 1.4300 (by virtue of a drop in EUR/GBP).

The key phrase there is 'on a closing basis', if supports hold and can close above there, we may yet see the bounce they look for, and considering we hit 1.3262 at the low, we have cleared out most of the stops. Our 1.38% Fibo target of 1.3420/1.3736 was 1.3300, and here we are, hmmm.

- Peter.Wadkins@ThomsonReuters.com