Euro Dollar 5 Minute Chart - 2nd April 2009

Euro Dollar 5 Minute Chart - 2nd April 2009

Today presents us with a complex picture for the euro vs dollar pair both from a technical perspective and also from a fundamental point of view.  To summarize yesterday’s price action the day closed with a small down doji which provides little in the way of direction for today or indeed for longer term trading, closing below both moving averages in a narrow trading range.  As I suggested in yesterday’s commentary trading opportunities were limited to intra day, and indeed had you followed my advice to look for short opportunities in the shorter time frame charts, you would have seen an excellent shooting star signal in the afternoon trading session which would have yielded around 80 pips in total.

In my personal view taking pips today will be even harder than yesterday given the array of fundamental news being released both sides of the Atlantic and all interwoven with one another and overshadowed by the G20 summit.  I have covered these in more detail in my eurodollar site.   For those of you who are relatively new to this market I would suggest stepping aside for today and waiting on the sidelines, but for those of you who are more experienced and are prepared to take a calculated risk, once again I would look for opportunities to short this pair in the shorter time frames, and only on the appropriate and confirmed signals such as shooting stars, long legged dojis and evening star reversal patterns.  Given the uncertainty surrounding today’s news items and events and, any unexpected volatility on thin volumes, I would suggest you take any profit off the table very quickly and only trade using tight stop losses looking for anywhere between 10 to 20 pips per trade.  As an example the following has just occurred as I am writing in the 5 minute chart and shows a tweezer top followed by a shooting star and confirming minor resistance 1.3307.

Don’t forget you can keep up to date with all the latest currency news, live currency charts and fundamental news by simply following the appropriate links.  Details of a good ECN broker are also included.