EUR/USD - Daily Candle Chart 17th March 2009

EUR/USD - Daily Candle Chart 17th March 2009

Whilst yesterday’s candle provided more evidence of a bullish tone in the euro vs dollar pair the close of the day was well below the high which almost touched 1.31 and as a result we were left with a large upper wick on the candle which suggests weakness in the market.  As we can from the daily chart the euro vs dollar pair has managed to hold above the unstable downward “wedge” and also above all three moving averages.  With the amount and number of resistance levels above this could be a tortuous and volatile move higher as prices approach and then attempt to penetrate the strong resistance levels.  The first of these levels is immediately ahead in the 1.3140 range and if this is breached then we could see a move back to test resistance in the 1.3400 region.  The price action so far today looks decidedly indecisive and with 5 major announcements of fundamental news due out shortly as well as yet another speech by Trichet this evening this could be a lively session.

My suggestion for today would be as per yesterday and that is small long positions at 1.2963 with a stop loss below at 1.2847 and look to build on these should we breach the 1.3000 region.

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