EUR/USD Daily Chart MT4 - 5th June 2012

The euro vs dollar has continued it’s bearish tone once again today, following yesterday’s short term rally which saw the pair briefly recover the 1.25 area on the daily chart. The trigger for the downward trend lower, was first signalled by the break and hold below the 1.3000 level on the daily chart, not only a key area of support at the time, but also a signifcant number.

Since then our Hawkey software has delivered an unbroken trend of red trend dots, further supported by our red heatmap on the MT4 platform. Finally of course we have our volume indicators, which are clearly showing increasing selling volume as the pair move ever lower, with the bearish volume only broken in the last two days with some buyers coming back into the market, as signalled with our green volume bars. The rising volume with falling prices are clear signals that this move has not yet run out of steam, and until we see significant stopping volume in the market, and buyers returning to the euro, then negative sentiment for the currency is set to continue.

The short term outlook therefore remains bearish, and if we see a break an hold below the 1.2270 region, then we could see the euro dollar test the 1.2000 region in due course.

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