James Chen
07-16-2008, 04:49 PM
7/16/2008 – EUR/USD – After reaching and slightly exceeding the all-time high resistance yesterday, price action on the EUR/USD daily chart, as shown, has made a tentative correction back down. All technical indications were pointing towards this long-awaited correction. And from purely a technical perspective, there appears that there may be some further room to retrace. Price has not yet reached the short-term uptrend support line (represented by the top green line), which also coincides with a key 38.2% Fibonacci retracement level (the low-to-high retracement being measured from the swing low to support on 6/13/2008 to the all-time high reached just yesterday). Oscillators like the displayed Stochastics are also emerging down from overbought territory. In the event of this continued downward retracement, the first level of support would clearly reside around the aforementioned uptrend support line, which, as mentioned, currently coincides with the 38.2% Fibonacci retracement level. In the event of a breakdown of this support, the next support area resides around the 1.5600 region.
James Chen
Chief Technical Analyst
FX Solutions
IMPORTANT NOTICE: These comments are for information purposes only. The information contained on this document does not constitute a solicitation to buy or sell by FX Solutions, LLC., and/or its affiliates, and is not to be available to individuals in a jurisdiction where such availability would be contrary to local regulation or law. Opinions, market data, and recommendations are subject to change at any time. Forex trading involves substantial risk of loss and is not suitable for all investors.
(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; uptrend lines in green; horizontal support/resistance line in yellow; 200-period simple moving average in light blue.)
James Chen
Chief Technical Analyst
FX Solutions
IMPORTANT NOTICE: These comments are for information purposes only. The information contained on this document does not constitute a solicitation to buy or sell by FX Solutions, LLC., and/or its affiliates, and is not to be available to individuals in a jurisdiction where such availability would be contrary to local regulation or law. Opinions, market data, and recommendations are subject to change at any time. Forex trading involves substantial risk of loss and is not suitable for all investors.
(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; uptrend lines in green; horizontal support/resistance line in yellow; 200-period simple moving average in light blue.)