Tracking the EUR/USD Pair

Date: 24.01.2012 Time: 21:52 Rate: 1.3031

Daily Chart

Yesterday’s Review

On the last trading day the price made another step on its way to change the main trend. The last three candles show the new mood while the third candle from the right is breaking the upper lip of the tunnel. The red candle after that checks whether the resistance level can be used as a support, and the last candle called “Engulfing”- a reversal candle to the previous red candle.

Now there is a possibility that the next resistance level at 1.3077 will get broken and the first target of the price will be the 1.3245 price level this level is a 38.2% correction of the downtrend shown by a broken red line on the chart. In case the price will stop at this area (meaning up to the upper lip of the Bollinger bands, now is around the 1.3100 price level) we can expect a correction in size of between a third and two thirds of the move upwards that started at the 1.2625 price level.

Current review for today

At the moment of writing those lines the price is approximately at the same level from which it started the trading day. It is possible to see its movement downwards and the way back to the area from which it started, the 1.3030 price level. The candle that describes the last trading day is uncertainty and a struggle between the buyers and the sellers over the direction of the pair.

As it was mentioned yesterday, breaking the 1.3077 price level will indicate that the price will continue its way north and the first target is the 1.3245 price level (32.8% correction of the last downtrend described in red broken line). On the other hand, a brake at this level and it is possible that the price will perform a correction in size of between a third and two thirds of the last move upwards which started from the 1.2625 price level.

You can see the chart below:

4 Hour Chart

Yesterday’s Review

The price has breached the 1.2978 price level and continued another 70 pips until the writing of those lines. Obviously the 1.2978 price level which is a 38.2% correction by Fibonacci, turned from a resistance level to a support and it is possible to be checked again. The target of the price is the 1.3087 price level which is a 50% correction by Fibonacci retracement of the downtrend described in red broken line), that will all occur in case the price will continue to go upwards.

Current review for today

Indeed yesterday’s review occurred as it was written. The price did came back to check the resistance that became a support on the 1.2978 price level for few times and now making its way towards the resistance level which is used as a Fibonacci correction level, the 1.3087 price level. Breaching this level will probably lead the price to the 61.8% Fibonacci correction level on the 1.3200 price level. In addition it is possible to see that the price is moving in an ascending price channel (blue broken lines) and it is possible that after the price will reach its upper lip, we will see a correction to the lower lip of the tunnel. In case the price will break the lower lip of the tunnel, it is possible to see a deep correction in size of between a third and two thirds of the uptrend that started on 1.2625 price level.

You can see the chart below:



Important announcements for today:

09.00 (GMT+0) EUR – German IFO Business Climate
09.30 (GMT+0) GBP – Prelim GDP
15.00 (GMT+0) USD – Pending Home Sales
15.30 (GMT+0) USD – FOMC Statement
20.00 (GMT+0) NZD – RBNZ Rate Statement