euro vs. dollar

Euro vs Dollar Chart 19 Aug 2010

The euro vs dollar continues to flirt with the 40 day moving average which is now taking on increasingly significance the longer the pair trade on this technical indicator.   Yesterday’s price action was symptomatic of the current status with the high of the session running into resistance from the 9 day moving average above whilst the close of the day found support from the 40 day moving average below.  Indeed, this pattern of price action has been repeated in today’s trading session with no sign yet that the 40 day moving average is likely to be breached.  However, the longer this continues then the more likely that we will see a sharp sell off and consequent break below this key level and once broken opens the way for a sharp move lower, initially to re-test support in the USD1.2397 price area with a probable fall to USD1.2151 in due course.

The fundamental news for the euro vs dollar has been dominated today by the slump in the Philly Fed and worse than expected jobless claims in the US.  This has led to a further fall in bond yields which may help to push the euro vs dollar below the 40 day moving average as traders and investors bail out of riskier assets.

What is one of the best retail forex trading platforms?  In my view it is Metatrader 4.  Advanced, powerful & intuitive it now comes with ECN execution, so you can happily scalp away without broker or dealer intervention.  Just download your free demo copy of MT4 by following this link – download metatrader free –  and get started today.  Don’t forget to follow my daily posts for updates and analysis of the forex markets to help you with your forex trading – so good luck and good trading.