Home » Euro vs Dollar Daily Chart » Trading Currencies – Euro Dollar 7th April 2009

Trading Currencies – Euro Dollar 7th April 2009

Currency Chart - Daily Candle Euro vs Dollar 7th April

Yesterday was an interesting day in the currency markets, and in many ways was symptomatic of a “lack of news day”, coupled with thin trading volumes in the run up to a long weekend, and a shortened week, and as I suggested in yesterday’s commentary one often sees volatile and unpredictable price movements when these conditions apply.  Following a gap up for the open this was then followed with a reversal and fall in prices during the day, with a wide spread down bar closing below both the 9 and 14 day moving averages, and provided a bearish engulfing candle which fully enveloped the hanging man candle of Friday.  With this morning’s attempt to rise also failing this bearish sentiment now seems to be taking hold and for a deeper move to the downside we will need to see the minor resistance at 1.3186 breached, and if so we could see a retest of support at this level.  With the 9 and 14 day moving averages now crossing this is adding to the short term bearish picture.

With thin markets and a lack of news my suggestion for today is step aside and wait for confirmation of the bearish signal and if this occurs in today’s trading session then look for opportunities  tomorrow and Thursday.  A further reason for caution is that the equity markets are now waiting for earnings which will also lead to narrow price ranges and thereby making trading tricky.   Two items of interesting news, the first from the IMF that it may issue a warning on toxic assets accumulated by both banks and insurers which they estimate could reach a mind boggling $4 trillion dollars, way in excess of anything discussed at last week’s G20 meeting.  The second relates to an announcement by the Federal Reserve of new currency arrangements with the BOE, BOJ, ECB and SNB allowing the Fed to receive euro, yen, sterling and Swiss francs until 30th October should the need arise, to provide liquidity in those currencies to US  financial firms.  Have we had an early warning that we are due a further round of banking and credit problems and all that entails.

You can keep up to date with all the latest currency news, live currency charts and fundamental news by simply following the appropriate links, and if you are looking for a good ECN broker I have provided more details here.