Euro possible Head and Shoulders

The channel breakout in the Euro I pointed out in my previous euro update certainly proved to be important. Channel formations are not necessarily reversal patterns on their own  but a potential Head and Shoulders bottom could be forming as well now with the neckline now around 1.32000. Should the Euro close clearly above this line I'd expect a further advance to the 1.3800 level. Often breaks from h&s patterns retrace to the breakout point before continuing the move in the direction of the original break. So watch out for that.

Of course on the fundamental side the next major move seems to hinge on Greek debt talks although as a technical analyst I try to ignore the news and focus on the price action. The market still feels like the big traders are very very short to me and that's a recipe for massive short covering should this pattern above play out.