Euro vs Dollar Chart Friday 16 Oct 2009

Euro vs Dollar Chart Friday 16 Oct 2009

An interesting end to the week for the euro vs dollar which began on Thursday with a potential ‘hanging man’ candle, which was partially confirmed on Friday with narrow spread down candle, which ended the week and day with a shadow to the lower body. The conundrum for technical analysts this week will be which of the current conflicting signals will eventually hold sway. First, we have a potential tweezer top, suggesting that we may see a short term reversal lower. In addition we have the partially confirmed hanging man signal, also suggesting that the current rally for the euro vs dollar is running out of steam as the euro dollar bears begin to exert some downwards pressure while tthe bulls try to maintain the upwards momentum.    Finally, the lower shadows of both candles suggest that there is still bullish support in the market, particularly as the 9 day moving average seems to be providing some support, and with none of the other moving averages breached at present, there is little to suggest that a bearish picture is, in fact, emerging. So there we have it – a confusing picture at present and no doubt all will be revealed as we start a new trading week for the euro vs dollar.  With strong support below, any pullback may only be limited to a 200 pip range to re-test the 1.47 price level in due course, which should provide an adequate barrier to any further move lower.

With no significant fundamental news on the economic calendar for Europe today (and indeed for most of this week) and only a minor release in the US – the NAHB Housing Market Index the forex market will be looking for direction from the wider markets and individuals (an example – Trichet’s recent statement that the euro was “not created to be a global reserve currency” ).  Indeed this afternoon we have a speech from Fed Gov Ben Bernanake who is due to speak about Asia and the global financial crisis at the Federal Reserve Bank of San Francisco Asia Economic Policy Conference in Santa Barbara where audience questions are expected.    With such a dearth of fundamental news today we should expect the unexpected.

You can keep up to date with all the latest fundamental news on the economic calendar, latest currency news and live currency charts by simply following the links.  I have also included details on an excellent ECN broker.