Forex Trading Technical Analysis (2010/08/16) EUR/USD Respects Bullish Trend
(Please click on the forex chart thumbnail to enlarge)
8/16/2010 Forex Trading Technical Analysis (FXpath.com) – EUR/USD (a 4-hour chart of which is shown) as of Monday (8/16/2010) has made a pronounced bounce off a key uptrend support line extending from the very beginning of the currency pair’s most recent prolonged bullish run, the 1.1875 4-year low hit on June 7. This rather precise bounce, which occurred just above 1.2700 support, highlights the strong dynamic support provided by the trendline. EUR/USD, therefore, can continue to be considered in an uptrend for the time being, albeit currently at the very lowest spectrum of this uptrend. In the event of further bullish momentum off this trendline support bounce, the key upside resistance target resides in the psychologically important 1.3000 price region, followed just above by 1.3100 area resistance. In the event of a subsequent breakdown below the trendline, immediate support resides around the 1.2700 price region, a breakdown of which could potentially target key 1.2500 support.
(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; chart patterns in white; 50-period simple moving average in light blue.)
James Chen, CTA, CMT (bio)
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Comments
Nevin,
Thank you so much, once again, for your very kind comments. They are very much appreciated!
James Chen
Well its a sudden bounce up at 1.27 at start of trading week. It really caught me by surprise as I am going to continue short. Today its down again. Most probably the up is only a retrace after days of heavy selling.
Lewis,
I agree. Price action looks like it could breakdown below the trendline soon. If there’s a further breakdown below 1.27, then that should confirm a potential trend change. Thanks for your comments and input, Lewis.
James Chen
Hey James very nice analysis!!
You have seemed to cover all bases here.
On a day chart we have a break of the trend line, but a very long candle that needs to reatrace, ill be looking to take a cautious long poistion then sort once the retrace is over.
James….thanks so much for your charts and analysis. You provide insight that I never seem to notice. I always read your comments and analysis in preparation for my trading day.