November 6, 2008 06:21

Technical Analysis – EUR/USD Selling Consolidation Pattern

Posted In: Technical Analysis
By:

11-06-08

4:26a GMT – The EUR/USD appears to be developing into a triangular consolidation pattern on the 4h charts (higher lows and lower highs), signaling that our downtrend is not over quite yet and that traders are just taking profit on some of their shorts. Fundamentally foreign stocks, especially the Chinese Stock market, were hit hard overnight following a significant loss on the US stock market meaning more investors could put money back into the relative safety of the dollar.

Trading Idea: Looking to sell at the top of the consolidation pattern (currently around 1.2950) or on a clean break of the bottom (currently around 1.2590). Shorts favored down to to the bottom of the pattern at 1.2590 and then onto 1.2500 and 1.2350.

(click to enlarge)

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