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Monday, May 17, 2010

Euro/Dollar (EUR/USD) Technical Analysis - Daily, May 17, 2010

Click on the graphs for a better view.
 The daily picture looks interesting and while the major direction is still south for the Euro against the Dollar, the Stochastic shows that the EU currency is highly oversold. Still the MACD indicator hasn't made new lows but the Euro price has. This could turn to a bullish divergence which would signal the downfall is about to over.
Still if such a behavior takes place, it shouldn't be expected to happen overnight. The path upward would be hard and cumbersome. The MA on each of the major graphs are still negative and the trend is still down for the Euro.

During the day however there could be interesting opportunities on the buy side for the Euro. One of these was the fall to 1.2250/60 area which was quickly cleared and the direction went north.
On the 4 hour graph we see the Stochastic is pointing strongly upward so it could be expected the upward movement to last at least to around 1.2360 area and even a bit beyond.
The 1 hour graph is still not firmly on a positive side but the ones of a smaller time-frame are. Especially the 30 min one. So a possible scenario is to touch 1.2360/70 and stop for taking a breath.
Still the daily graph is not positive for the Euro so a buy Euro strategy remains a risky opportunity which stands on a shaky ground.

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