02, January 2014

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

General Overview

European investors have returned after holidays as a result we can observe some optimism on European stock markets and the dollar could strengthen versus the euro.

Late last week, the single currency rose versus the dollar having set a two-year high level, but could not hold the success and fell to the area near the price opening.

The northern movement is confirmed and strong. The price is fixed above the cloud and below the Chinkou Span.

The upward movement will be continued until the Kijun-Sen is below the price. Kijun-Sen is horizontal and Tenkan Sen is directed downwards.

Bollinger Bands shows a north movement, its bands are expanded upwards. The long positions are relevant now, but after amplification "golden cross."

The current correction is confirmed by MACD as well which histogram is directed downwards.

Trading recommendations

The 1.3800 break turned out to be a false. The price returned below 1.3800 that is a signal that the buyers' power is coming to naught and bears will dominate soon.

The first bears target is the level 1.3740. After passing that mark the price is likely to go to 1.3670.