My long from 1.4403 profit-stopped out at 1.4418 for +15 pips. Clearly, I was a bit aggressive in moving the stop but as I pointed out yesterday, this trade was no sure thing (not that any trade is) and I had a small position.
The pair isn't out of the woods. Although it has broken above the short-term downtrend line on the three-hour chart, it is at resistance from the June 7 spike high of 1.4563. As a result, I'd expect to see sellers coming in here and am looking to take a short position. The overall move from the May low looks corrective (actually, it doesn't look corrective so much as a pair hanging on for dear life). On the daily chart (not shown) it could be a bear flag. But these things can surprise you and if the pair breaks above 1.4682 then the picture becomes much more bullish. 1.46 would be a psychological victory as well. As I blogged yesterday, the doji low was near support and so far the rally is holding. I would like to see momentum falter on the shorter-term charts.
Support is at 1.4395/89, 1.4346, 1.4260 and 1.4228. Resistance is at 1.4532, 1.4563, 1.4682, and 1.4714.
Here's the three-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.
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