25, September 2013

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

General Overview

According to Greg Gibbs, who works as a strategist at RBS, the ECB President Draghi made a speech the other day which was relatively dovish. By payment of credit of the central bank, as a result of reducing excess liquidity upward pressure on interest rates of the monetary market may increase significantly. ECB fears of tightening that can occur with the strengthening euro. In its turn the ECB concern should restrain the growth of EUR.

Having bounced off the 1.3320 support level near the lines of the Kijun-Sen and Tenkan-sen, the Euro has formed a large "bull" candle, which broke through the level 1.3450. And then the price reached the resistance level 1.3565, bounced down and consolidated, forming a small candle with short equidistant bodies. Kijun-Sen and Tenkan-sen lines maintain the upward crossing of the "golden cross". The line Kijun-Sen began to unfold horizontally while the Tenkan-sen line is rising. The market is experiencing "bullish parade of lines".

Bollinger bands are directed up, its bands are narrowing.
The MACD is in a positive area going down.

Trading recommendations

The break of 1.3500 support was accompanied by a small trading volume. The price falling was on declining volume, which can serve as a good signal for a rebound during the approach to the rising trend line 1.3455.

If the price bounces up from the rising trend line, the immediate goal will became the resistance level 1.3500 - 1.3510. The break above 1.3510 would mean a continuation of the upward growth with a target - 1.3550.