September 4, 2008 03:27

Technical Analysis – EUR/USD Caution; Sell Rallies

Posted In: Technical Analysis
By:

9-4-08

3:19a GMT – EUR/USD is very bearish on all but the weekly and monthly charts (where solid support has yet to be broken) and I am looking to sell rallies. In the short term, however, caution is advised as a bullish reversal hammer formed yesterday on the daily charts right on strong daily support (right above 1.4475). On top of that a bullish RSI divergence has appeared on the daily charts.

Trading Idea: look for a bit of a rally in the EUR/USD before selling bearish reversal signals on strong rallies. At a minimum target back down to support at 1.4475. If you are cautious I would advise sitting this one out until clearer direction is given in the market.

(click to enlarge)

Click here to receive my free forex signals via email
Click here for more info on how to use my free forex signals
Click here to learn how much you can earn with our Forex Income Calculator
Discuss this signal with me and fellow traders at the new Forex Discussion Groups

Leave A Comment
XHTML: feel free to use any of these tags.

LEGAL DISCLAIMER AND RISK WARNING

Foreign currency exchange trading is highly speculative and is suitable only for those who (a) understand and are willing to assume the risks involved, and (b) are financially able to assume significant economic losses. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. Trading on margin can amplify both gains and losses in your account. Before deciding to trade foreign currencies, you should carefully consider your investment objectives, level of experience, and risk appetite. You should be aware of all the risks associated with foreign currency exchange trading and seek advice from an independent financial advisor if you have any doubts.

All contents or information displayed or contained on Piphut.com are based on a number of assumptions which may not be fully disclosed or explained. Hypothetical trading or performance has many inherent limitations, including the benefit of hindsight and the fact hypothetical trading or performance involves no economic risk. Variables such as the ability to adhere to a particular trading program despite trading losses and maintaining adequate liquidity are material considerations that can adversely affect actual trading results. No representation or warranty is being made or given that any account will or is likely to achieve profits or losses similar to those displayed on Piphut.com. There are frequently substantial differences between hypothetical performance and the actual performance subsequently achieved by a trading program. You must exercise independent judgment when making investment or trading decisions. Past performance is not indicative of future results. Please read the User Agreement and Risk Disclosure Statement for more information.