The pair closed last week @ 1.4150 area, after a bull move that from a low of 1.3150 triggered through all retracement target and went up over 61.8% of last bear move. right now the clear target will be 1.4550, but in the meantime I see some opportunity to collect few pips shorting the pair, or as well there will be some opportunity to go long on lows.
Next week we will have some news release that will bring some volatility to the pair and also on Thursday we may see a 0.25% rate cut from ECB, which if will not happen should at least advise some long covering before Thursday.
Another sign that may suggest a long covering is the dramatic move that happened last Friday: around 350 pips in one single day, which will translate into a profit taking on each sign of nervousness.
1.4000 or around that area may be a good level to build a long position; or it may be a first target for whom may decide to short the pair.
Up to Thursday than it will be clear if will be better to old a short position or to go long and target 1.4550.
The only thing that will be certain is that there will be a lot of volatility.
Happy trading
From: http://forexdc.blogspot.com