07, February 2013

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

General Overview

Forex market analysis on euro for February 7th shows that the price has formed a new «dead cross» and has moved below the Kidjun-sen level. If the price continues its movement it can provoke a downward movement.

The current signal to buy is confirmed and weak as Chinkou Span is below the price chart and the price is in the Ichimoku cloud. Now the goal of a downward movement is the Senkou Span A. If the price fixes in the Ishimoku cloud, a downward movement can be continued with the goal Senkou Span B, the first level of support 1,3465.

The downward movement will be actual as long as the price is below the Kidjun-sen (1,3585), if the price consolidates above this line the sell signal will be weakened and that will question the downward movement.

The Chinkou Span is below the price chart that is a confirmation of the current sell signal, indicating a bearish mood of traders.

Bollinger Bands shows a horizontal movement. We suppose that short positions are more relevant now.

MACD is turned up that indicates about current correction movement; the turn of this indicator downward may become a signal for a renewal of the downward trend. The rebound of the price from Kidjun-sen also can provoke continuation of the upward movement.

Trading recommendations

We advise to consider a downward trading with the first target 1,3465, but only after the price fixes above the Ishimoku cloud. When overcoming this target a short position will become actual to the next target which is 1,3290.

Stop loss we place above Kidjun-sen 1,3585 and when this line goes down you can move the stop loss after it.

When we get profit of 50 - 60 points stop-loss can be moved to a breakeven. When open short positions MACD should be directed downwards.

Take-profit can be set slightly above the target levels - 1,3460 and 1,3275.

Besides a technical picture it is necessary to consider and the fundamental data and time of their release.