EURUSD makes it to 1.3407.
As we move to the last hour of trading, the EURUSD has made its way to the 50% retracement of the move up from the June 2010 low. It is month and quarter end but the traders are voting for more downside risk for the pair. The price is still above the low for the week (low was reached on Monday at 1.33616) but closing near the key 1.3407 level is certainly not a bullish bias.
Weekend risk exists for the pair. On the bearish side include the Greece situation with its contagion effect. Although they talk and meet and promise about this or that, the recovery in Greece is daunting and likely to lead to a more downside risk. There will be corrections but ironically until there is a definitive solution which will likely include a default, restructuring, recapitalization of banks, the rallies in teh EURUSD will likely be sold.
EURUSD back to 1.3427 area…
The EURUSD is back down to the 1.3427 support area
Report on Bloomberg that Buffett has been approached European banks
He commented that he is not a good prospect. He does not name any banks either.
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EURUSD rotating back down
The EURUSD held the 1.3459 resistance target and has rotated back down to the 1.3427 level. This level and the 1.34077 price remains as support for the pair. It is month/quarter end so there exists the possibility of position squaring.
France’s Sarkozy says he urged Papandreuo to implement reforms
- Greek authorities are ready to work with EU experts
- Will meet with Merkel in Germany in coming days to work with EU experts
I wonder how many times the promises will continue to be made?
EUR/USD Resumes Bearish Trend Bias
EUR/USD (daily chart) as of Friday (9/30/2011) has begun a resumption of its bearish stance after making a bullish correction within the context of a strong and steep breakout downtrend. This new downtrend has its origins at the early September breakdown below a key wedge pattern and then below the 1.4000 price region, which represented a confluence of three important support factors: the 200-day simple moving average, a key uptrend support line extending back to the June 2010 low extreme, and the 1.4000 psychological support/resistance level. After the breakdown of that support confluence, price has displayed a strong bearish trend interspersed with regular bullish retracements. Most recently, after hitting the new downtrend’s low around 1.3360 in the beginning of this week (which is also around the 161.8% Fibonacci extension of the last major bullish correction), and stopping shy of its 1.3300 downside target, price retraced once again before now resuming its bearish directional bias. In the event that the pair is able to hit its current downside target at 1.3300, the next key downside target within the currently prevailing downtrend resides around the important 1.3000 psychological support level.
(Click on chart to enlarge. Forex chart key: price on 1st pane, Stochastics 14,3,3 on 2nd pane; horizontal support/resistance levels in black; uptrend lines in green; downtrend lines in red; 50-period simple moving average (SMA) in orange; 100-period SMA in brown; 200-period SMA in dark blue; Fibonacci levels in magenta.)
James Chen, CTA, CMT
Director of Technical Research and Education
FXDD
EURUSD moves toward 50% of move up from June 2010 low
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