EUR/USD Daily Outlook 29 Jun 2011
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..
Best Regards
Haitham653
Wednesday 29 June 2011 06:27 AM
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Comment by Yasser on June 29, 2011 at 6:41am -
Thank Haitham, Are you saying that if it gets to 1.4440 dont short it. According to your recommendation if it break 1.4338 then we are going to 1.4150 intraday. is that correct. What do you think may happen with the Greek vote today.
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Comment by Haitham653 on June 29, 2011 at 7:04am -
Selling the pair around 1.4440 is risky too much , even it makes no sense at all !! But testing 1.4400/40 then drooping towards 1.4360 will give the pair strong bearish momentum !!
And we need 2 conditions :
1- a break below the support of the rising wedge ..
2- a break below the support level 1.4338..
This scenario may happen the next 24 hours...and it may not at all !! let's watch and wait !!
About the vote for Greek ...soon we'll find out !!!
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Comment by Haitham653 on June 29, 2011 at 8:07am
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Update:
we have a bullish breakout on 30 min and 1 hour above 1.4400 , BUT the pair declined strongly and already closed below these levels , now it will try to close above 1.4400 level once again , if success , then it will test 1.4370/40 then pullback towards 1.4440 and keep ranging between 1.4350/1.4440 , if fails to close above 1.4400 , also it will test 1.4370/40 level , it may pullback towards 1.4440 or it may break below 1.4340 so be careful !!!
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Comment by Yasser on June 29, 2011 at 8:22am
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Thanks Haitham, do you expect it to fail at 1.4440 and drop down after watching the price action so far .
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Comment by Haitham653 on June 29, 2011 at 9:25am
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So far , it's unable to close above 1.4400 but it may able any moment ...the idea is , if it fails to close above 1.4400 , it may break below 1.4340 , if it does close above 1.4400 it will range between 1.4350/1.4440 for 24/48 hours and we may go long around 1.4350/60 at the first test for this level , our stop 50 pips , target around 40 pips...
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Comment by Haitham653 on June 29, 2011 at 9:30am
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I've forgot to say , the pair closed above 1.4400 on 30 min but the1 hour not yet , if the pair drops toward 1.4350 now or soon (without H1 close above 1.4400) the 30 min will try to push the pair higher towards 1.4440 but the 1 hour will try break below 1.4340...
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Comment by Yasser on June 29, 2011 at 9:32am
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Thanks Haitham, i am looking for a long at 1.4350 to take me to 1.44 and then try a short there,Thanks your analysis has been most helpful.
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Comment by Egbosimba christian chinedu on June 29, 2011 at 9:40am
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what if it breaks the bollingo at 1.43884 so what next
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Comment by Aldi Urban on June 29, 2011 at 10:01am
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it closed 1,4400 on 1hr chart
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Comment by Haitham653 on June 29, 2011 at 10:03am
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1.4388 doesn't matter , what is matter the support of the rising wedge as shown on the chart posted above , and the support level 1.4338 , once these levels are taken out , the pair will drop at least towards 1.4150 !!!!
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