08, February 2013

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

General Overview

Forex market analysis on euro for February, 8th shows that the price finished «a dead cross» and jumped out of the Ichimoku cloud. As a result a downward movement continued.

The current sell signal confirmed and strong as Chinkou Span is below the price chart and the price is below the Ichimoku cloud.

For the current moment the goal of a downward movement is Senkou Span B. If the price fixes below 1.3397 a downward movement will continue with the next goal which is 1,3290.

The downward movement will be actual as long as the price is below the Kidjun-sen (1.3502). 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 the continuation of the downward movement, the bands are extending and heading downwards.

We stay for short positions now.

MACD is down that indicates the downward movement. Should the indicator turns up that could be a signal for a short term correction. We will receive another signal for correction when the price bounces from the Kidjun-sen.

Trading recommendations

We advise to consider a downward trading with the first target 1,3290 but only after the price fixes below 1.3397.

When overcoming this target short position become actual for the level – 1,3168.

Stop loss we place above Kidjun-sen 1.3502 and when this line goes down we 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. If MACD turns upward you can manually reduce short position.

Take-profit can be set slightly above the target levels – 1,3300 and 1,3186.

Besides a technical data it is necessary to consider also the fundamental news and time they are published.