Last week we saw the Euro make a correction and then push forward making new recent highs. So this could be another exciting week with more gains coming for the Euro.
However due to profit taking there could be a correction in the Euro before we see any more gains. The first target level I have on the Euro is 1.4237 then after that is a key resistance level at 1.4363
Support levels for this pair are 1.4050 and 1.3800.
Yohay wrote on Forex Crunch in his weekly update that the Dollar will be weak unless we get some major surprises, so that is what I will be looking for the dollar weakness to continue.
Kathy Lien in her blog published a chart that is useful for seeing what levels some of the major pairs have been at. Which also helps me to make trading decisions. The more information I can get on the currencies helps me to make better trades. So with that being said this is my plan.
How I am going to trade this pair this week ?
I am going to watch for a correction to the 1.04050 level and watch the support there and see if it holds up. If that support level holds up I am going to get in long. If that support level gets taken out I am going to watch the trend line on the bottom I have drawn on my charts and watch for the bounce off of that lower trend line around the 1.3900 level. I plan to buy off of a bounce on that trend line.
If the pair does not correct I will be watching for nearest resistance level and I will be checking to see if the price can break through it and then buy after a break. Or if the price bounces off the resistance level I will sell the pair and watch until the correction ends.
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4hr Chart Eur/USD
Winner’s Edge Trading, as seen on: