It has been in a vicious downtrend so this is most likely a corrective pattern rather than a trend reversal. Regular readers know I have no problem trading corrections but I'm not clear on this one so it's best to not trade it—more than one successful trader has said if you don't know what's going on, stay out. It's nibbling at its upward trend line at the moment and RSI has dipped a bit below its upward line. .8380 will be critical and if it starts to falter there then sellers will most likely pile back in.
Resistance is at .8342, .8382/.8400, .8519 and .8594. Support is at .8265, .8218, .8180, .8107/00, .8068, .8000 and .7900.
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.
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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