Euro vs Dollar Chart 20 Nov 2009
Little in the way of anything new in the technical picture for the euro dollar, which continues to consolidate in the current level with Friday’s price action merely confirming once again the strong pennant formation on the daily candle chart, with the point of the pattern centering on the 1.49 price handle. With all three moving averages closing fast, and with the daily price action becoming ever more concentrated, it seems unlikely that we will have to wait too much longer for the inevitable and sustained breakout from the current price congestion, with the straddle option being my preferred trading strategy for this pair at present. For longer term trend trading a break above the 1.5050 level remains the key target, which will then indicate a return of the bullish sentiment of the last few months, whilst a break below the 1.47 floor of the current trading channel, and indication that the euro dollar has assumed a bearish tone in the short term. With last week’s unusual FED statement from Ben Bernanke still clear in our minds and those of the markets, do not be surprised to see some interventionist action in the US, as despite the rhetoric, they are clearly worried about the ever declining dollar and may well take some action in due course, even if only to signal to the market their concerns and any possible action they may take in the future.
All the items of fundamental news on the economic calendar for Europe focus on the Flash Manufacturing and Services PMI data for France, Germany and Europe whilst in the US this afternoon we have the Existing Home Sales figures which are expected to come in at 5.71m against a previous of 5.57m. This afternoon also has a speech from ECB President Jean Claude Trichet which in the absence of any other news may cause some ripples in the euro dollar.
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Support & Resistance for the Euro Dollar :
S1: 1.4829 R1: 1.4890
S2: 1.4789 R2: 1.4911
S3: 1.4768 R3: 1.4951
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