Wednesday August 20, 2008 - 16:46:18 GMT
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Chart of the Day - 8/20/2008 - EUR/USD
(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; downtrend lines in red; 200-period simple moving average in light blue.)
8/20/2008 â€“ EUR/USD â€“ In what amounts to a continuing low-volatility consolidation in the major pairs, EUR/USD (an hourly chart of which is shown) has formed a short-term parallel downtrend channel. This gradual down-channel consolidation is expressing the remnants of the extreme downward momentum that has defined the pair in last several weeks. Range-trading the current channel might be a possibility, but the height of the range is rather tight. A strong breakout to the upside of the channel, on the other hand, could potentially signal the beginnings of a long awaited correction. In this event, the next resistance to the upside resides around the 1.4850 region. If price respects the range boundaries, however, support resides at or near the bottom of the channel.
Chief Technical Analyst
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