18, February 2013

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

General Overview

Forex market analysis tells us that the price finished that the whole Friday the pair was in the flat. It tested the level 1.3327 and 1.3303 but returned at 1.3350 by the end of the day. The price is in the channel between Tenkan-Sen and Kijun-Sen now. The market is looking bearish.

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

The goal of the downward movement is still the level 1.3259 through levels 1.3327 and 1.3300. If the price consolidates below this support zone the downward movement can proceed further.

The downward movement will be strong as long as the price is below the Kidjun-sen (1.3411). If the price consolidates above this critical line we can expect the price to move upwards.

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 are widening, its lines are directed downwards confirming the current sell signal. The price is angling down.

MACD is down and showing a sell signal. Should the indicator go up or the price bounces up from 1.3350 that could be a signal for another correction.

Trading recommendations

We advise to consider a downward trading with the first target 1.3327. When overcoming this level short position become actual to the next one 1.3300 and 1.3259.

Stop loss is to be placed above the Kidjun-sen and when the price 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. You can open new orders on sale if MACD turns up or if the price rebounds from 1.3350 level.

Take-profit can be set slightly above the target levels.