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[Jhoe]

The EUR/USD is hovering above the .38 retracement level of its last rally, from around 1.18 to nearly 1.43. I have that level pegged at 1.3362, should see a moderate bounce here, and of course, the reverberations throughout commodities and stocks should follow. The only question is how big a bounce we see. One rule of thumb I have is the lower the volume, the less predictable the bounce might be, which is why I took off alot of my short position in the currency market. I wouldnt be going out and getting long anything here, because its entirely possible that EUR/USD falls right through this level and the next support level doesnt come in until around 1.33 or so, possibly even as low as 1.31. The risk of a low volume unpredictable bounce here in my opinion though outweighs the probability of the euro breaking this level during today's trading session, so my profit-taking is more of a risk/reward call than anything else. FWIW, I'm trading the same way in equity positions, profit taking shorts, but not getting long. Might scout out a long trade or two but only if I see EUR/USD start to bounce, and only for a day trade. careful out there guys