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eur usd update.

01/05/2011

Things are slowly crawling back to life after the holiday season. I took the week before Christmas through the new year off so I spent the first part of this week getting reacquainted with the charts. Hopefully, by next week I should be completely back to the swing of things, posting regularly, and updating my favorite section “rants and thoughts” with some good topics.

But, until then, time for the charts.

First the Eur. day. While volatility never really left the market, we have yet to figure out a trend.

The daily chart clearly shows a downtrend, but we have to be careful. the 1.3050 – 1.3150 will be pivital. We are sitting on a confluence of the 200 sma, a very strong 50% retracement of the June – November uptrend. AND a minor trendline. A failure of this area will open up 1.28 (.618% ret) In addition, we have failed to make lower lows (or lower highs for that matter) since Dec. 1. So, we need to be careful in this range.

On the hour, we are in a nice little downtrend having shorted either at the double top, or perhaps one of the 3 MA crosses. We need to be cautious about shorting these lows though. For the bears, we broke the .618 retracement on the way down, but for the bulls, we haven’t broken the trendchannel or made new lows.

Personally, I’m looking for a bounce at these areas to re-short into a fib or MA touch into early London session.

Trade safe.

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