EURUSD—big jump

My long from 1.3308 has certainly moved up nicely by any accounting and I just took partial profits at + 307 pips. I wrote last week that the Euro was puttering about, either delaying the inevitable (a drop to 1.29) or continuing a corrective wave two that would reach to at least 1.3818. It looks as though it's trying for the latter but after it reached a high of 1.3692 this morning, it has fallen back. On the hourly chart, RSI has fallen from oversold (greater than 70). In addition, a triangle is forming. Often, triangles mean continuation although the pair is threatening to drop below it. The pair must stay above 1.36 for the continuation to seem plausible.

One can see the double bottom on the charts (1.3267 and 1.3293) and the pair has broken beyond the neckline which was at 1.3591. If price stays above this, the potential price target is 1.3899/1.3915.

Support is at 1.3598, 1.3500, 1.3445, 1.3366, 1.3342, 1.3283 and 1.3267. Resistance is at 1.3692, 1.3705/20, 1.3818, and 1.3893/99, 1.3915.

Here's the hourly 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.