Feb 27 2009 10:54 Est
Casey Stubbs– Winners Edge Trading
Whether you are a long term trader, a swing trader, or a day trader it is a good idea to look at what the big picture. So I thought I would take a look today at the monthly Eur/Usd charts and see what we find.
When you get a different perspective on things if opens up new insights and opportunities. Everyone has been talking about the Dollar strength how we are in a long term bearish move on the Euro. However when you look at a monthly chart you see that we are still in a Euro bullish move. The bullish trend on the Euro started on Oct 1, 2000 at the price of .8232 and went from there all the way to 1.6039 on July 1, 2008 that is an 8 year bull move.
So at the current price of 1.2677 we are not even at the .50% level on a Fibonacci retracement which indicates we are in a retracement of the bull move. The bullish trend on the euro has not ended and we won’t know if is over until we get back to the .8232 price point.
Our most recent support level is 1.2329 which was hit in Oct of 2008 and that level is not to at the .50% retracement level either. After the 1.2329 level we have another support at 1.1662 which is just past the .50% retracement level. So there are 3 support levels that we should be watching in the future the 1.2329 our recent support, the 1.2126 which is the .50 retracement level and the 1.1662 support level hit on November 1, 2005.
When the price gets to those levels we could see an immediate bounce and the pair could continue the bull run that we see on this monthly chart. Which is what I think will happen in the near term future. There is also the possibility of a penetration of those levels which could indicate a reversal in the long term trend in this pair.
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