06, August 2014

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

General Overview

The European currency was within a narrow range against the dollar and then the pair fell. Obviously, this "marking time" can be explained by the expectations about the ECB sentiment and intentions which will be clear after the coming meeting. The market nervousness is still preserved as the further easing probability is high.

The price bounce from the descending channel allowed the buyers to stop the downward trend at the support level of 1.3360. We observed the bounce up from the price level which was followed by a high volume.

The price is finding the first support at 1.3360, the next one is at 1.3290. The price is finding the first resistance at 1.3420, the next one is at 1.3480.

There is a confirmed and a strong sell signal. The price is under the Cloud and it is above the Chinkou Span. The Tenkan-sen shows a downward movement and the Kijun-sen shows a horizontal movement and form a “Dead cross”. The downward movement will be until the price is under the Cloud.

The MACD indicator is in a neutral territory. The price is decreasing.

Trading recommendations

The breakthrough of 1.3420 mark will open the way up to the next resistance located at around 1.3480. The mark 1.3480 retest is more likely to lead to the short-term consolidation.