EUR/USD - Weekly Forex Analysis

EUR/USD (a daily chart of which is shown), after showing a concrete bullish bias at the beginning of this past week, simply consolidated in a tight range before dropping significantly towards the end of the week. This drop has formed a tentative top in the pair, with technical indications indeed hinting at a loss of bullish momentum. The high that was reached before price turned down had approached strong resistance represented by the last swing high at 1.3735.

With this key resistance tentatively respected, and momentum indications confirming a likely bullish exhaustion, the upcoming trading week of May 18-22 could see further downside price action targeting further support around 1.3380 and then 1.3300.

Any uptrend continuation would only be confirmed on a breakout above 1.3735, in which case further near-term resistance resides around the 1.3900 price region.

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Comment by Kiwi

2009-05-17 03:18:04

AUD has turned down with EUR set to follow but what is GBP doing having a quiet cup of tea at what should be the top of the market?
Strength in the FTSE and GBP has me wondering.
It seems untimely, just as the larger rally seemed untimely.
Markets have a split personality, overreacting in both directions. For volitile GBP to not react seems odd.
Perhaps the lull before the storm, with traders being invited to risk overtrading in the high yield GBP pairs.

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