The Euro wobbled a bit this morning, dipping to 1.3573 but above yesterday's 1.3431 low and the pssychological 1.3500. I took advantage of the dip to buy at 1.3587 although I had to grit my teeth to do so because there are negative signals as well as positive ones. Isn't that often the way?
My short-term outlook depends very much on how Euro behaves as it struggles with the 1.3686 high that has capped it the last 24 hours. The fact that it's back here after a mild dip means it's battling to get through. This is formidable resistance since it's near or at a speed line from the daily chart, a fib, and the lower boundary of the uptrend channel that the pair fell below in November. So good luck with getting through that.
My longer view is bearish as I've previously blogged. The pair would have to close above 1.4000 for me to change that view. But in the interim, there are enough buyers out there it seems to keep the bears from taking complete control, though they're sending out signals through such things as divergence on the three-hour chart.
Resistance is at 1.3686, 1.3717, 1.3800, 1.3860, 1.4060 (weekly downtrend line from 12/2009) and 1.4283. Support is at 1.3573, 1.3500, 1.3457/31, 1.3396 1.3245/20/00 (strong), 1.3154 and 1.3000 (big psychological).
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.