It is great to be able to write another post this week. I hope that this article will assist traders in getting an idea of how to trade this week.
The Eur/Usd traded in a small range last week. The trading analysis I wrote in last weeks post has not changed much, because the pair bounced off of the 1.4400 resistance level and the 1.4200 support level.
Since we were trading in such a tight range we should see a breakout soon, it might be this coming week or next week. One thing to note is that this week is going to be monumental for news. There will be many news announcements that will move the market so you will want to read Forex Crunch’s Weekly Forex Outlook so you will be aware of the news this week and have information to accurately review the market. In addtion to reading the Forex outlook you may want to look at the daily event calender before trading each day.
The 1.4450 level is the most important level we will be looking at. This resistance level has been challenge many times recently so that makes it critical. It was also challenged back on December 17, 2008 you can see the wick starts right there on the daily candle. This level is going to determine whether the Euro will continue to rise verses the Dollar.
To begin to trade this week we see that the price is at 1.4300 which is between the 1.4400 and 1.4200 the two main support and resistance levels that have been challenged last week. That means that we will be watching for breaks and bounces of those levels.
If the pair continues to move in the direction it was moving on Friday to 1.4200 we will watch for a bounce or break off of that level. If the pair breaks we will enter short with a target of 1.4050. Make sure you put in stops and trade with acceptable risk that you have put in place in accordance with your trading strategy.
The pair could bounce off of the 1.4200 level and then we would look to enter long with an immediate target of 1.4400.
When the pair is going to the 1.4400 resistance level we will be doing the exact same thing as we did with the support levels, looking for a bounce or a break. If there is a break look for 1.4450 and then 1.4640 and 1.4700 the pairs high on December 7, 2009
To see more price levels for check the EarnForex Blog
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