Euro has hit a high of 1.4036 this morning. This is close to the top of the resistance zone I wrote about last Monday of 1.3993 and 1.4042. This zone came from the downtrend line on the daily chart from Nov. 2009 as well as a speed line from the 1.1902 low. The speed line is now at 1.4065 but this is also near a crossing of two speed lines, the second one from the 1.2974 low. There should be some profit taking. It looks as though that's happening. I'm still long from 1.3866 but took partial profits at +140 pips.
The three-hour chart shows the potential for an evening star. The first and second candles of the three-candle pattern have formed. The confirmation will be if this third candle currently forming closes deep into the first candle. This first candle ranged from 1.3956 to 1.4031.
Support is at 1.3956 today's low and the rectangle boundary), 1.3900, 1.3880/61, 1.3803 and 1.3732.
Resistance is 1.4282/95 (Nov. 2010 swing high and weekly downtrend line from 2008) and 1.4317/47.
Here's the three-hour chart:
© Dianne Fecteau, 2011. 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.