Bear Flag Broken – Euro Resumes Downtrend; All Eyes on Italy

Article originally published on innerfx.com and republished here with permission

Quote of the day:“The ability to delude yourself may be an important survival tool.” ~ Jane Wagner

Good morning. The euro has finally exited the consolidation range within the bear flag formation – as noted in my previous article. Current weakness is caused by the fear spreading to Italy in the widening debt crisis, as the Italian borrowing costs surged to 7.25% yesterday. The US Trade Balance and Bernanke’s Speech are some of the key events of today’s Economic Calendar.

Downtrend resumed as the bear flag formation was breached yesterday. I remain bearish on EURUSD and will look for new selling opportunities if price pulls back towards former support zone around $1.37. Well, maybe that’s a bit too far away

Euro Vs US Dollar Chart 4hrs 11-10-2011Euro Vs US Dollar Chart 4hrs 11-10-2011

USDCAD

I’ve been keeping an eye on this resistance zone around 1.0230 for a few days and it seems that it is finally being breached.

US Dollar Vs Canadian Dollar Chart 4hrs 11-10-2011US Dollar Vs Canadian Dollar Chart 4hrs 11-10-2011

EURAUD

This is another interesting setup which I’ve addressed recently –  it seems that there’s more upside for EUR against the AUD and 1.36 looks like a reasonable target

Euro Vs Australian Dollar Chart 4hrs 11-10-2011Euro Vs Australian Dollar Chart 4hrs 11-10-2011

GBPUSD

Support near 1.5900 is under pressure yet again, so waiting a little bit for a new selling opportunity on the break lower is probably the best bet right now. Don’t forget it’s the BOE’s rate decision day

British Pound Vs US Dollar Chart 4hrs 11-10-2011British Pound Vs US Dollar Chart 4hrs 11-10-2011

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About abwehra group

The Art&Science of Trading Gold
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