Euro Retesting Support; Bear Flag Formation Suggesting More Downside

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

Quote of the day:“Achievable goals are the first step to self improvement.” ~ J. K. Rowling

Good morning. The euro is still trading in range against the dollar after the G20, NFP release and more news coming from Greece. Greek Prime Minister George Papandreou agreed to resign after the formation of a new government coalition.

Here’s a couple of charts to start the week:

EURUSD

Downside is still under pressure as the euro failed to maintain momentum at 1.38 and above. A bear flag formation is currently being seen on the 4-hrs chart, so it’s probably a good idea to look for new selling opportunities on the potential break lower, which might be fueled by news from Italy which is in focus these days.

Euro Vs US Dollar Chart 4hrs 11-7-2011Euro Vs US Dollar Chart 4hrs 11-7-2011

USDCHF

The Swiss Franc is losing ground across the board after SNB’s Philipp Hildebrand said that they are ready to act in order to further weaken the franc. Key resistance is not far above current trading levels, starting at .9100 – so it’s probably best to consider buying the dollar and others against the franc.

US Dollar Vs Swiss Franc Chart Daily 11-7-2011US Dollar Vs Swiss Franc Chart Daily 11-7-2011

USDCAD

Upside remains under pressure as the US dollar holds onto recent gains. A break above 1.0250 is in the cards

US Dollar Vs Canadian Dollar Chart Daily 11-7-2011US Dollar Vs Canadian Dollar Chart Daily 11-7-2011

EURAUD

The distance between price and falling trendline connecting recent lower highs is shrinking, and – as noted on Friday – it’s the potential break above the said resistance line that looks like the best best right now: the euro has a lot of room to the upside (not necessarily a reversal but rather a correction)

Euro Vs Australian Dollar Chart 4hrs 11-7-2011Euro Vs Australian Dollar Chart 4hrs 11-7-2011

AUDJPY

Still in range on risk-off trade and it doesn’t seem that it’s best to buy it yet – maybe after a new test of 80.

Australian Dollar vs Japanese Yen Chart Daily 11-7-2011Australian Dollar vs Japanese Yen Chart Daily 11-7-2011

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The Art&Science of Trading Gold
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