(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; chart patterns in white; 50-period simple moving average in light blue.)
4/16/2010 – EUR/USD – Bearish price action in the last two days on EUR/USD, a daily chart of which is shown, has finally filled the substantial price gap that occurred in the very beginning of the trading week. This gap fill raises the possibility that a bearish stance within the current overall downtrend may once again come back into play after the double-bottom and bullish correction that were established late last week. Further bearishness on this gap fill should target strong support in the 1.3400 price region. In the event that 1.3400 is broken convincingly to the downside, clear further support resides around the double-bottom low, in the 1.3265-80 price region. Any break below that double-bottom low would confirm an overall downtrend continuation, potentially targeting further downside support around the 1.3100 price region.
James Chen, CMT
Chief Technical Strategist
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