Home » Euro vs Dollar Daily Chart » Euro vs Dollar – Daily Currency Rates 23rd June 2009 (EUR/USD)

Euro vs Dollar – Daily Currency Rates 23rd June 2009 (EUR/USD)

Euro Vs Dollar - Daily Currency Chart 23rd June 2009

The euro vs dollar continued to consolidate in a narrow trading range yesterday ending the day on a down bar which closed below both the 9 and 14 day moving averages and which once again tested the neckline of the recent head and shoulders.  The neckline of this pattern is now becoming a key battleground as prices continue to flirt in the 1.39 region and above and indeed this pattern has been replicated once again during the European trading session with a bounce back largely attributed to ECB President Jean Claude Trichet.   With increasing uncertainty as to the future monetary policy from the FOMC all the markets are now waiting for some clear signals from this meeting which should provide the catalyst to break the log jam of consolidation we have been seeing since last week.   However, do not underestimate the market’s capacity to cause a degree of mischief and mayhem where the market direction has not rationale or logic and indeed in many markets this is the case right now.   This has been seen in the past few months in equities which have risen dramatically fuelled only by sentiment and optimism and with no factual basis whatsoever.  The currency and commodity markets are behaving in a similar vein and indeed yesterday’s fall in crude oil price was a classic example where the wide spread down bar was not replicated with a consequent and opposite effect in the Dollar index.

From a technical perspective the question for the euro vs dollar is whether the neckline will hold.  If it does then we should expect to see a dramatic fall in the Eurodollar in due course but equally the head and shoulders pattern may simply morph into another consolidation area and a platform for a move higher.   At the moment it is impossible to predict and all I would suggest is that we use other correlated pairs, such as the dollar to cad, proxy indicators and markets such as the Dollar Index and crude oil to try and gauge where this pair is likely to go.

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