Last week, Euro closed above the downtrend line drawn from the 2008 highs. Price action today has moved above last week's high of 1.4325 to a high of 1.4424. The monthly chart shows an engulfing candle forming (outside bar) with a higher high and lower low than took place in April. This is occurring after four monthly candles with higher highs and higher lows. This is a warning of a possible trend change. The pair is also stuck in a confluence zone so it needs to move above 1.4490 to gain some real upward traction.
Look for support at 1.4194 (the downtrend line from the 2008 high) and 1.3969 (last week's low). Resistance is 1.4424 as well as 1.4490.
© 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.
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