Chart of The Day - 6/09/2008 – EUR/USD

10/06/2008 11:19

The EUR/USD 4-hour chart, as shown, is showing some interesting technical indications. On a long-term basis, this key pair is currently mired in a horizontal trading range, or consolidation. On the 4-hour chart, price is shown to have just bounced down off a significant resistance level after an impressive short-term bullish run in the past several days. This bounce back down occurs after hitting the combined resistance imposed by the yellow horizontal support/resistance line (in the 1.5815-45 region) and the underside of the green uptrend line. Oscillators like the displayed Stochastics, which are emerging directly down from severely overbought territory, are lending some strength to a continued short-term bearish move. In the event of this impending move back down, the next major support to the downside resides in the historically significant support/resistance level in the 1.5360 region, which price just reached last Thursday.

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; downtrend line in red; uptrend line in green; horizontal support/resistance level in yellow; 200-period simple moving average in light blue.)


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