EUR/USD Analysis

EURUSD has not yet recovered from it’s largest downward correction in nearly 10 years. Technically it’s still in an uptrend within a corrective phase. When this part of the corrective rally terminates, Euro dollar value should be between 1.4490-1.4690.

In the meantime there is a continuing to month correction of the rapid rally that began April 22nd and topped out at 1.4338 on June 3rd. This is a sideways and down move that should bottom out not lower than 1.3737. Any decline below this level would jeopardize the continuation of the uptrend.

The current downward move will probably end around mid-August, after which the uptrend should continue. Failure to reach the downside target near 1.3737 will be quite bullish.


Daily EURUSD chart with volume as at 30 July 2009 using NextVIEW Advisor Professional

TECHNICALS

SMA200 – rising at 1.3475
EMA20 – immediately above the market and curling down.
Li’s Sandwich indicator – gives a fairly accurate depiction of resistance and support that agrees with more complex mathematical measurements of the market.
R1 – Significant resistance at 1.4303
R2 – zone of resistance from 1.4490-1.4690.
S1 – a zone of support between 1.3777 – 1.3728
S2 – 1.3610 (not shown on chart).

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Article and Commentary by Don Schellenberg. A trader and trading coach, he is a noted expert on Market Structure, Elliott Wave and Fibonacci. He trades the forex market.