[GBLilleyUSMC]

Economic Releases:
News for looks extremely light on Forex Factory. There are only two releases pulling up at this time that even show in the orange. The only one that I think could possibly bring us trouble would be the month on month German producers price index being released at 1:00 AM CST.

Long term analysis:
We have executed what I would count as a double top on the daily chart. And the 5/8 is trying its best to cross right here. The area that this pair has double topped is important since it is more or less the 161.8 % Fibonacci extension of the move up from June of 2001 to January of 2005. Price then hit a 38.2% Fibonacci retracement. The appropriate target for a 38.2% fib is the 161.8% extension which lies more or less right around the 1.6000 level.

Price seems to have simply stalled around the 1.5800 level which is very close to the 50% retracement level from the move up from 7/7/08 to 7/15/08. Price action does not look interested in bouncing here. It looks more like it may hang here for a bit before dropping down again.

Hourly Indicators:
We still have our 21/55 and 5/8 crosses to the downside. Price also seemed to be reacting to the 200 EMA today which is around 1.5829. Our hourly MACD has been more or less just playing around today. I would not trust it for any direction when it is acting like this, it is basically braiding. (Braiding is where 2 EMAs cross and recross continually and this shows lack of market direction.) Braiding is a good indicator not to trade.

Support and Resistance levels:
Today we have been ranging between 1.5809 and 1.5894. There is ascending dynamic resistance currently at 1.5790 then at 1.5733 that should offer support to the downside. Resistance should be found at 1.5937 then 1.6000 to the upside. So there are a couple of dynamic levels that I would like to see us break through before we can have a serious move to the downside. It may take us a few days to get through these levels.

Moving Average Control:
Its easy to see that we are in a consolidation period when you start to look for an EMA that truly has control of price and cannot find one until you get to the Weekly chart. The Weekly 21 EMA is the only EMA on the hourly chart or above that has clear control over price. It lies at 1.5524, so that will be an area to watch when we get there.

Overall bias:
My overall bias on this pair is short; however, I think that we still have some serious levels to contend with on the way down before we can consider this pair in a downtrend.

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