Quote of the day:“To know the road ahead, ask those coming back.” – Chinese Proverb
EURUSD – 1.4179 @06:48 GMT
Good morning. The euro is taking a breath after the large decline but current recovery is still modest. There’s more room to the upside until the euro will test key resistance, eventually. Meanwhile, interim resistance is seen at 1.4230/50, followed by 1.4350. Daily charts are bearish while the smaller time frame charts, such as hourly, are currently bullish. On the hourly charts we have two corrective movements (see charts below), one to 62% of 1.4340 to 1.4050 yesterday – suggesting that downtrend has resumed and the second one between 50% and 62% of yesterday’s upleg – suggesting that a retest of 1.4230/50 is in the cards. However, selling on signs of weakness is the best things to do for now, in my opinion. My plan to sell at 1.4230 was good so far and I’m still holding the position, but I would have been happier to see the EURUSD back to 1.4050 today. If current recovery continues, I’ll look to close around breakeven point and sell again if downtrend resumes aggressively. The German Zew Sentiment is today’s most important event in the Economic Calendar
Trading strategy: holding short at 1.4230, stop at breakeven, target open
Support: 1.4130/50, 1.4050, 1.4000 and 1.3900
Resistance: 1.4200, 1.4230/50, 1.4280/00, 1.4350/70
Market sentiment: long term – mixed, medium term – bullish, short term – bearish, intraday – bullish
- EURUSD hourly chart 5-17-2011
- EURUSD hourly chart 5-17-2011-2
- EURUSD daily chart 5-17-2011
have a good day and good luck trading
Are you not a bit afraid that the American debt affects the eur/usd on the bullish way?
I think that the the main "debt victim" nowadays is Greece. US has more options to choose from in the near future.
Between the two bad apples, if one is going to default, that will be Greece.
Anyway, the debt problems have longer term implications so it doesn't really matter for traders targeting a few (hundred) pips, there are opportunities for both buyers and sellers almost every day. Just look at today's chart: down in the morning, up mid-day, down again, up later…. usual market noise in a narrow range.
On the long-term, the dollar is unchanged and it will most likely continue to lose value as long as QE continues. And it will continue, as soon as the markets will start melting down after ending QE2. Maybe QE3 will be "rebranded" but the impact on the dollar will be the same.
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