Euro to US Dollar - FX Daily Chart Currency Trading 21st April 2009

Yesterday’s wide spread down bar added momentum to the bearish tone in the euro vs dollar pair in two distinct ways.  First the move was accompanied by a falling window on the daily chart, often referred to by Western chartists as a gap down but I prefer the Japanese terminology.  Whichever term you prefer both indicate momentum entering the move.  Secondly, yesterday’s price action broke below the triangle pattern created over the last 5 weeks all of which suggests that we may see a further move lower in due course.  The only caveat I have to the above analysis is that we are now deeply embroiled in the consolidation region which started at the beginning of the year and trading in this region may be laboured and prices may be subject to a degree of sideways movement as they hit the various support and resistance areas.

I have covered all the fundamental news on the economic calendar for you in more detail on the main  euro dollar site and would only add that today sees the German government meeting with the banks to sort out the “toxic assets” – a follow on from Trichet’s comments early in Japan when he said that the Bank would be looking at using “non standard” measures in an effort to resolve the current crisis.

My trading suggestion for today is to look for small short positions on an intra day basis using the 15 and 30 minute charts and in particular following this morning’s small rally to identify shooting stars and bearish reversal candle patterns for your entry points.  For the euro bulls among you longer term trading may be the order of the day but only on a sustained break above all three moving averages and certainly above the 1.3500 region.

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