2-18-09
5:26a GMT – Bearish trend continued yesterday with another 150 pip drop to a 2009 low of 1.2560. While I am still bearish on the pair there are a few bullish signals on the 4-hour chart that would give me pause. Mainly, the pair is very oversold right now. The RSI is hovering just above 30 and there is a bullish divergence on the RSI chart. That being said there is always an extreme RSI when there is a strong trend, so I don’t put too mch weight on that alone. But I will play it safe and look for rallies to sell and bearish candlestick signals to enter short.
Trading Idea: looking to sell rallies near resistance, most notably between 1.2660 and 1.2700. Short targets preferred down to 1.2585 and 1.2475. If a sustained break of 1.2700 is made look for a challenge of 1.2800.
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