01, March 2013

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

General overview

The correction is over the euro is back to its downward movement. The pair is trading under the cloud.

Euro moves to the 50-th fibo level from falling 1.3318-1.3017 on the hourly chart. This is an important level as it might affect the future direction of the pair. If it overcomes this level the price will continue to fall, should it bounce up that could lead to a correction or a complete change of a direction.

The target of the downward movement is the first support level 1.3055. If the price is fixed below this target the southern movement can proceed to the second support level 1.300.

The sell signal is strong and confirmed. The Chinkou Span is below the price and the price is below the Ichimoku cloud. The downward movement will be as long as the price is below the Kijun-sen (1.3167).

Bollinger Bands indicator suggests a continuation of the downward movement. Its bands are directed down and broadening.

MACD is also down and confirms the downward movement.

Trading recommendations

It is recommended going short. The first target is 1.3000. Should the pair overcome this level the price will go to 1.2940.

Place a take profit slightly above target levels. After receiving a profit of 50-60 points stop loss can be moved into the breakeven.