EURUSD – Consolidation Continues

Quote of the day: “The key issue for an investor is not necessarily to be able to predict that, but to be able to react quickly.” – Mohamed A. El-Erian

EURUSD – 1.4838 @06:47 GMT

Good morning. The EURUSD is still in range above 1.4770 support which is still valid after 3 days since it was first tested. Intra-day sentiment is mixed, as current recovery from 1.4770 could be corrective – part of the decline started yesterday at 1.4900. But the short-term studies are bullish and there are no distinctive clues to suggest that a reversal is due soon. In case of prolonged correction, keep an eye on key support zone into the 1.45-1.4650 region. 1.4870/00 is still a tough barrier but I think we’ll see the EUR breaking higher to test 1.5 in the coming days. Exiting out if this 4-day range, preferably to the upside, should provide decent trading opportunities.

Trading strategy: looking to buy around 1.49 on potential 4-hrs bar close above 1.4870, initial stop at 1.4830 (0.5% risk), target open. Secondary plan is to look for selling opportunities on potential break below 1.4770, with an initial stop at 1.4830 (0.5% risk), target at 1.4650

Support: 1.4770/00, 1.4730/50, 1.4700 and 1.4600/30
Resistance: 1.4850, 1.4880/00, 1.4950 and 1.500
Market sentiment: long term – mixed, medium term – bullish, short term – bullish, intraday – bearish

Do you expect the EURUSD to exit the consolidation range in the next sessions?

EURUSD 4hrs chart 5-3-2011
EURUSD 4hrs chart 5-3-2011
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About abwehra group

The Art&Science of Trading Gold
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