EURUSD Recovering Some Ground, Remains Vulnerable

Quote of the day: “In America, there’s a failure to appreciate Europe’s leading role in the world.” – Barack Obama

EURUSD – 1.4417 @07:12 GMT

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Good morning and Happy Europe Day! In case you’ve missed the last posts from other categories, you may want to check them now: Interview With Steve From and How to Better Use the Internet for Trading and Personal Purposes. Alright, now let’s take a look at EURUSD which is still under pressure after last week’s large sell-off. Support into the 1.45 zone failed to hold, sending EUR to as low as 1.4315 after the NFP release. The sell-off has been especially fuelled by an article in German news magazine Der Spiegel, reporting that Greece is considering withdrawing from the euro and returning to its former currency. Current support around 1.4300 looks fragile and the euro has to break above 1.45-146 once again, to regain upside momentum. Looking on the daily charts, technically the uptrend is still intact but the large decline over the last two days represents an important warning sign and it’s probably better to look for new selling opportunities in the coming days, as long as 1.45-1.4650 will cap the upside. The economic schedule is lighter today, but there are some important events later this week.

Trading strategy: looking to sell on potential pullback to 1.4550, stop at 1.4610 (0.5% risk), target open

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EURUSD Vulnerable After The Sell-Off, Ahead Of Non-Farm Payrolls

Quote of the day: “If everything seems under control, you’re not going fast enough” – Mario Andrett

EURUSD – 1.4565 @07:05 GMT

Good morning. A bit latter today, in one hour or so, I am going to publish a great interview with a trader I admire and I suggest you don’t miss it. Ok, back to the EURUSD now. Yesterday’s decline was impressive: several failed attempts to break over 1.49 on its way to 1.5, a prolonged range-bound trading between 1.4770 and 1.49 were already suggesting that a break on either side would be violent due to a huge number of stop loss orders out of the range. Trichet’s less hawkish comments signaled that a rate hike is unlikely in June, but rather in July – sending EUR below short-term support zones. Euro’s sell-off was also supported by the free-fall in commodities. Kind of a perfect storm… Well, the week ain’t over yet as this is “that” Friday of the month. The EURUSD is currently trying to build support on the median retrace of last up leg from 1.4220 to 1.4935, as seen in the chart below. Whole 1.4500-1.4550 region looks like a decent intra-day support so far. Looking at the daily charts, there’s more room for this correction, but the uptrend is still intact. Keep an eye on support zone all the way down to 1.4450, though. In case of an upside pullback, intraday resistance comes around former support zone at 1.4650, followed by 1.4700-1.4750.

Trading strategy: looking to sell on potential pullback to 1.4700, stop at 1.4760 (0.5% risk), target at 1.4600

Support: 1.4550, 1.4500, 1.4450 and 1.4400
Resistance: 1.4590/00, 1.4650, 1.4700 and 1.4750/70
Market sentiment: long term – mixed, medium term – bullish, short term – mixed, intraday – bearish

EURUSD 4hrs chart 5-6-2011
EURUSD 4hrs chart 5-6-2011
EURUSD daily chart 5-6-2011
EURUSD daily chart 5-6-2011

have a good day

EURUSD Higher Ahead Of ECB Meeting

Quote of the day:“When a stupid man is doing something he is ashamed of, he always declares that it is his duty.” – George Bernard Shaw

EURUSD – 1.4878 @07:06 GMT

Good morning. Yesterday’s breakout was fake but the euro is holding gains not far below 1.49 before the ECB Rate Decision and Press Conference due later today. Fed Bernanke’s speech and Initial Jobless Claims are other important events in the Forex Calendar today. The range is still in play and the daily chart doesn’t suggest much at this point. Hourly studies are slightly bullish though, as interim resistance at 1.3870 is being tested at time of writing. My plan to buy on break of range turned bad as price returned into the range, so I had to accept a loss and move on. It is still tempting to look for buying opportunities on (yet) another breakout attempt, but I guess I’ll just watch or focus on other pairs until direction is more clear.

Trading strategy: standing aside

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EURUSD Still Range Bound

Quote of the day: “Where there is much light, the shadow is deep.” – Johann Wolfgang von Goethe

EURUSD – 1.4844 @07:13 GMT

Good morning. Surprisingly (or not), EURUSD is still trading into the range which holds for 5 days now. Both lower and upper range limits, at 1.4770 and 1.4870 respectively, have provided strong barriers on each day. Tomorrow’s ECB Rate Decision and Press Conference are some of the most important events in the Economic Calendar this week, and would probably be bullish for the EUR as the ECB is strongly signaling that additional rate increases are likely this year, but at a moderate pace. Today’s important events are the ADP Nonfarm Employment Change at 13:15 GMT and Fed’s Fisher speech at 21:00 GMT. Looking at current intraday EURUSD chart (hourly), we can see that the EUR is getting a lift after retesting support at 1.4770 earlier today. One thing is certain: it will exit the range soon, as there are too many positions built on both sides with stops out of the range, therefore exiting one way or another would likely trigger a cascade effect of stop-loss orders, giving it a greater chance of a sustained breakout. Short-term sentiment remains bullish as EUR is still holding gains, not being affected by the large correction in Silver and Gold.

Trading strategy: Primary plan is to buy around 1.49 on potential 4-hrs bar close above 1.4870, initial stop at 1.4830 (0.5% risk), target open. Another plan is to look for selling opportunities after a 4-hrs bar closing below 1.4770, with an initial stop at 1.4830 (0.5% risk), target at 1.4650

Support: 1.4770/00, 1.4730/50, 1.4700 and 1.4600/30
Resistance: 1.4850, 1.4880/00, 1.4950 and 1.500
Market sentiment: long term – mixed, medium term – bullish, short term – bullish, intraday – neutral

EURUSD hourly chart 5-4-2011
EURUSD hourly chart 5-4-2011
EURUSD daily chart 5-4-2011
EURUSD daily chart 5-4-2011

Have a great day

EURUSD – Consolidation Continues

Quote of the day: “The key issue for an investor is not necessarily to be able to predict that, but to be able to react quickly.” – Mohamed A. El-Erian

EURUSD – 1.4838 @06:47 GMT

Good morning. The EURUSD is still in range above 1.4770 support which is still valid after 3 days since it was first tested. Intra-day sentiment is mixed, as current recovery from 1.4770 could be corrective – part of the decline started yesterday at 1.4900. But the short-term studies are bullish and there are no distinctive clues to suggest that a reversal is due soon. In case of prolonged correction, keep an eye on key support zone into the 1.45-1.4650 region. 1.4870/00 is still a tough barrier but I think we’ll see the EUR breaking higher to test 1.5 in the coming days. Exiting out if this 4-day range, preferably to the upside, should provide decent trading opportunities.

Trading strategy: looking to buy around 1.49 on potential 4-hrs bar close above 1.4870, initial stop at 1.4830 (0.5% risk), target open. Secondary plan is to look for selling opportunities on potential break below 1.4770, with an initial stop at 1.4830 (0.5% risk), target at 1.4650

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Dollar Strengthening On Bin Laden Death

Quote of the day: “Fighting terrorism is like being a goalkeeper. You can make a hundred brilliant saves but the only shot that people remember is the one that gets past you.” – Paul Wilkinson

EURUSD – 1.4793 @07:32 GMT

Good morning. The big news today is that bin Laden had been killed in Abbottabad, Pakistan by American military. The US dollar strengthened on the news as commodities declined from recent highs and the euro also retreated, extending Friday’s pullback started at 1.4875. My Friday plan to take a small position on the potential break above has failed, as the pair couldn’t sustain gains. However, I remain bullish on EURUSD even if a potential correction will bring support into the 1.4520-1.4650 region in focus. 4-hrs charts are still bullish at time of writing but would turn negative on the potential decline below support at 1.4770, opening the door to 1.4630/50 as possible bearish target. ECB’s Trichet Speech is today’s most important event in the FX Calendar at 10:00 GMT, followed by the US ISM Manufacturing Index at 15:00.

Trading strategy: looking to buy on potential pullback to 1.4685, stop at 1.4625 (0.5% risk), target open

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EURUSD Consolidating; Upside Favoured

Quote of the day: “Marriage is like a bank account.  You put it in, you take it out, you lose interest.” – Irwin Corey

EURUSD – 1.4835 @07:15 GMT

Good morning. Intraday resistance at 1.4850 is being tested at time of writing and there are no clues to point downwards yet. I don’t know if today’s Royal Wedding will have any impact on the financial markets, but if we check the Forex Calendar to see the usual events schedule – the most important today would be Fed Bernanke’s speech at 17:30 GMT which will likely boost Gold and Silver to fresh record highs, while the dollar will remain under pressure. Looking at both daily and weekly EURUSD charts, it’s quite clear that a test of $1.5 in the coming days is imminent. Maybe there’s where a multi-week correction will start. Meanwhile, buying dips and looking for new breakout buying opportunities are the best things to do.

Trading strategy: looking to buy a small size at 1.4870, stop at 1.4820 (0.25% risk), objective at 1.4970

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USD Continues to Weaken; EURUSD Getting Closer to 1.50

Quote of the day:“You’ve achieved success in your field when you don’t know whether what you’re doing is work or play.” – Warren Beatty

EURUSD – 1.4847 @07:07 GMT

Good morning. The dollar continues to weaken, reaching fresh lows after yesterday Fed Bernanke’s press conference. The euro climbed to as high as 1.4880 earlier today, threatening 1.50 which is not far above current trading levels. Intraday support is now seen at 1.4780/00, followed by 1.4730/50 lower. The US GDP and Initial Jobless Claims are today’s key events in the Economic Calendar. Short term studies are unlikely to change in the coming sessions as there’s enough room for downside pullbacks without affecting momentum of both daily and 4hrs charts.

Trading strategy: looking to buy on potential pullback to 1.4760, stop at 1.4710 (0.5% risk), target open. Secondary plan is to buy on strength at 1.4875, stop at 1.4825 (0.5% risk), objective at 1.50.

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Dollar Under Pressure Before Fed

Quote of the day: “There is no harm in being sometimes wrong – especially if one is promptly found out.” – John Maynard Keynes

EURUSD – 1.4673 @07:18 GMT

Hello. I hope you had a nice Easter weekend. The Economic Calendar is quite busy in the coming days and today’s Fed’s rate decision and statement is one of those events everyone is waiting for. The dollar continues to lose ground across the board as the EUR was trading into the 1.47 region earlier today. However, trading will probably be quiet until later today. The daily charts remain bullish and we now have support around 1.4520 which was a stable resistance level in the first half of April, before resuming uptrend after bouncing off lower support at 1.42. In case of a pullback from current levels, the same 1.4520/50 is where to look for new buying opportunities. Looking higher, above 1.47 there’s no important resistance level up to 1.50 which is both a psychological barrier and the top side of 2009 (best seen on the weekly charts how the euro faced selling pressure when reaching fresh highs). If you are more concerned about hourly charts, then it’s a good idea to keep an eye on first intraday support at 1.4600/30 formed by previous tops and the median retrace value of yesterday’s rally from 1.4490 to 1.4710 (see chart below). Personally, I prefer to wait the Fed statement before considering any trades; but judging by how charts look like at this moment, I’m more inclined to look for buying opportunities either on a breakout above 1.47 or pullback to 1.46 or lower, to 1.4520/50, considering selling on the break of support at 1.4520.

Trading strategy: standing aside

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