The EUR/USD broke above the neckline 1.4305 on 4 hour and tested 1.4400 as mentioned in yesterday's report , the pair didn't reach the first assumed target around 1.4440 !!! but it may test it today !!!
If you take a quick look to the daily chart , we still trading in a downward channel and under negative pressure since we are below 1.4750...
Now look to the hourly chart posted above , the pair is forming a rising wedge..
The rising wedge is a bearish pattern that begins wide at the bottom and contracts as prices move higher and the trading range narrows,in contrast to symmetrical triangles , this pattern can be one of the most difficult chart patterns to accurately recognize and trade, while it is a consolidation formation - B.Band confirmed it - the loss of upside momentum on each high gives the pattern its bearish bias...
However, the series of higher highs and higher lows keeps the trend inherently bullish, the final break of support- 1.4338 - indicates that the forces of supply have finally won out and lower prices are likely.
MACD,OsMA ,RSI and Stoch indicate that the uptrend is losing momentum but CCI says that the pair may test 1.4440 before going down !!!
Weekly support and resistance levels: (27June - 01 July 2011)
Resistance: (1.4285) main, where correction is possible, break would test (1.4390), the next levels are (1.4495) and (1.4600)…For buyers the bullish zone is above 1.4285
Support :( 1.4075) main, where correction is possible, break would test (1.3970), the next levels are (1.3865) and (1.3760)…For sellers, the bearish zone is below (1.4075)...
The neutral zone is between (1.4075 - 1.4285) where it is recommended to evaluate activities on 60 min and 240 min.
The pivot level for this week is (1.4180)…
Since the weekly pivot is below the monthly, a strong bearish move on the horizon, a daily close below this level will support the downtrend....BUT we are at the last week of June, the pivot level for this week doesn’t break below the monthly support 1.4100 so strong pullback also on the horizon toward 1.4426 - 1.4750 so we need to watch the pair day by day to find its upcoming direction!!!
Weekly :use 1 hour and (4 hour ..recommended).
Above 1.4285 very bullish trend..
Between 1.4180 - 1.4285 light bullish trend.
Between 1.4075 - 1.4180 light bearish trend..
Below 1.4075 very bearish trend..
Trend Direction is Upward (weak), the trend will remain valid as long as stability is above1.4360, a daily close below this level may lead for strong bearish move towards 1.4000 levels…
Recommendations : Upon the chart and the explanation posted above , my recommendation is selling the pair with an hourly closing below 1.4338 targeting 1.4150 and stop loss 1.4410..
Wednesday 29 June 2011 06:27 AM