The SNB finally intervened last week, sending the pair from a low of 1.4145 to 1.4411 in the course of an hour on April 1. Now, with the market sluggish since then, it's unclear as to whether this will hold. The weekly chart showed a doji but it's not really a hammer as the upper shadow is a bit too long. However, just as it climbed from an imperfect hammer in 2008 (arrow points to it), it can climb from this one. There is significant downward pressure on the Euro so it won't be easy. A .382 retracement from 1.5382 would have the pair at 1.4617 which is also near a price resistance level so it would be a good short. 1.48 and 1.51 would be the next resistance levels after that. If price starts to falter before a climb gets underway, a short that expected moves back to the 1.41 lows is justified but now that there has been intervention once this year, it's likely to happen again.
Here's the weekly chart:
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.
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