One thing to watch in the Euro is the failure swing in RSI on the one- and three-hour charts. Welles Wilder in his book, New Concepts in Technical Trading Systems, wrote that failure swings are "significant after an RSI high in the area of 70 or low in the area of 30 (p.68). This is what has happened on both charts with the subsequent swing up not penetrating the prior swing up. It's bearish but of course with short-term charts it means in the short-term. However, combined with the overall downtrend in the longer multi-month time frame and with the fact it's at resistance, could mean the pair will finally start moving lower again. Let's see.
© 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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