Clear case for long EUR/USD now?

Here is what I see. It is significant because I was bearish as all get out with a medium term projection down to mid 1.44. Usually you only see things that support your own bias so I took particular notice of this analysis
Weekly Chart
last sessions drop targeted the weekly trendline and bounced forming a doji so far. There just happened to be a fib level intersecting the trendline for good confluence for trading long at that level.
Daily Chart
The daily chart shows a hammer as the move down retraced 61% with oscilator divergence.
I have a bullish bias based on these technicals and anticipate a move higher, possible ignited by upside surprise payroll numbers this friday

Hey mate,

Like your analysis, very simple, but I think I can make a case for the bears. Although this is premature as we are still in an uptrend, I think there is a reasonable chance that we may see a reversal.

Looking at the weekly chart, the yellow trend channel is the channel I believe to be the true angle of the current trend as it respects the parallels very nicely. However, I believe that the parallel closest to the bottom, along with the aqua trend line to be the real established bottom of the trend now, not the solid yellow line. If the trend were still healthy it should not break these two lines. Once it does, and I believe it already has, then I would not expect the solid yellow to provide much support.

Zooming in to the daily chart, it can be seen that the above mentioned lines have been breached, but not broken by a daily close, but I do believe these lines have been solidly broken. Thursday last week we saw a nice bullish engulfing pattern form right off these lines, only to be all but negated the following day by the strong bearish action. The final straw for this pattern was the break of the low (and the two lines) we saw yeaterday. Although the daily candle did not close bellow, if I look at the 4h chart it seems like a very strong break indeed, with some very strongly bearish candles. I am convinced that the lines have been broken.

Going back to the weekly chart, we can see a very nice bullish engulfing bar has just formed. Also, the last high has just been breached, whereas the trend was priviously staking bricks and respecting highs. In addition, the highs have been getting progressively less agressive, and reaching lower hights with respect to the current trend channel. It looks like the trend is being compressed into the bottom of the trend channel, ready for a break.

If we zoom out to the monthly chart, we see that the long term trend line was broken about 13 months ago. We have now made our way back up to that trend line, and the month of october saw a weak pinbar form off the line. Even though the pin bar is weak, this bar, combined with the inability fo price to solidly break the 1.47 high as well as the solid bear candles that took us from 1.6 to 1.24 add weight to the case for a reversal manifesting. In fact , the monthly chart tells me there is a reasonable chance of a full retrace of the current trend and even lows below the 1.24 level, but this is a long way off and there are many barriers (not least the 1.3840-3740 level!) to get through before this is acomplished

Most of this will not effect my trading at all as I am much shorter term focused, so take this with a grain of salt. I do like to have a weekly bias whenever possible though, and this week it is bearish due to the above analysis, mostly the weekly bearish engulf. This will not change unless the engulfing bar is breached or there is some very strong daily or shorter term action that tells me otherwise.

For the record, I think the 1.4840 level should produce a nice shorting oprtunity if we get up there due to a nice s/r level and 50% fib confluence
http://img190.imageshack.us/img190/9540/euweekly.png

http://img525.imageshack.us/img525/3037/eudaily.png

http://img190.imageshack.us/img190/5969/eu4h.png

http://img190.imageshack.us/img190/6284/eumonthly.png

Thats a strong case for the bears and I was trippin on all those breaks before the bull case presented. Im with you on the shorter terms as I scalp 10 - 20 pips of the 15 min chart but I always fully analyse from top down to provide a bias and important s/r levels. The long bias from this analysis has served me well this session as price has rallied 50 pips so far. Here are the long trading opportunities I was able to exploit (+2 counter trend scalps)

Long entries
1.Price returns to 15min trendline support + historica daily s/r(light blue)
2.Price retest the same support area again after a fake out
3.Price returns to previous resistence level which now acts as support after the break
4.Price returns to test the backside of the hourly trendline it just broke
5.Price returns to monthly pivot after breaking through

counter trend shorts

6. Monthly pivot resistence
7 daily trendline backside retest

all entries provided 10 - 15 pips with little or no drawdown. There are no breakout entries as I refuse to chase price

Mate, havn't you been busy. Thats alot of trades. Nice work buddy, looks like you pulled in some good mollah today. Looks and sounds like you trade much the same as me, but a lot more frequently. Is E/U your only instument?

well,

it depends how you draw your daily trendline.

You could draw it like this and connect much more lows than you did. In that case we might see a reversal. Of course, the price can get volatile on these circumstances to try to fake everybody out.

someone made a nice conclusion about div's:

"the thing about divergences.

they can get bigger and bigger and bigger... "

Looks like my go long now case now was very accurate with price moving 200 pips in the london and NY sessions after my post.
Less frequently is a good thing. In hindsight, it would have been best to take only one of those trades, number three or number four. They could have been traded with a risk reward of 1:3 with partial profits taken and the remainder left to run. You would only need to take one of these a day. You could risk more and be more profitable this way. I am working on being more selective and trading less. Yes E/U is it - I can only be accurate by focusing all my attention on one instrument. There is alot of ground to cover in preparation, MTF analysis, news etc and then there is the actual trading itself. Each to his own but I would rather get one perfect than 2 or more so so. The returns you get from doing this justify this viewpoint. It is one of my main strengths and would recommend it to anyone. I had a very well respected and experienced trader on this forum oppose my bullish view yesterday trading of all things, GBP/CAD. He went long the dollar using this instrument. I believe the difference was my attention to detail using one instrument only