The pair may be trying for a run at 1.2343, the downtrend line from the May 10 high. At that point, I'd probably short the pair since it can't seem to get a lot of traction going for a rally and since it hit a new low earlier this morning of 1.2111. That's also in an area of prior resistance and fib retracement from the May 20th high. And the sentiment remains bearish.
On the other hand, 1.2132 was 50% of Euro's lifetime high/low or 1.6038/.8225 and the 1.2111 is not a great deal below that. On the hourly chart there is slight positive divergence. So the area may serve as support, at least for a while. However, unlike last week, I can't work up any enthusiasm for longs.
Resistance is at 1.2334/43, 93, 1.2453, 1.2574/99, 1.2670, 1.2740 and 1.2803. Support is at 1.2204, 1.2132 (50% of Euro's lifetime high/low or 1.6038/.8225), 1.2111, 1.20000 (psychological), 1.1826, 1.1641 and 1.1432.
Here is the one-hour 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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