EUR/USD Technical Analysis for 27.04.2010

The expected explosive increase of the Euro in the technical analysis from yesterday took place (as it is seen on the graph) and the EU currency gained about 0.8 cents to trade at about 1.3415 US Dollars. At that point a nice bearish MACD and Stochastic divergence was formed on the 4 hour graph so reasonably the Euro took its way down. This can be clearly seen on the graph on the left - shown by the red lines (click on the graph for a bigger view).

The daily EUR/USD graph (click on the graph for a bigger view) supports the view for a further incerease of the US Dollar against the Euro for today or even for the several days ahead. What we could witness is a test of the previous low of the Euro at around 1.32.

Dollar / Euro Technical Analysis

The Euro today is still under pressure while Greece is struggling to find its way out of the debt mess. There is a chance Germany will try to delay as long as possible the release of the first part of the money Greece needs. The date of the current debt payment by Greece is said to be May 19th so there are at most about 3 weeks of uncertainty ahead.

Technically the Euro has fallen almost enough. On the Monthly graph the EU currency seems more and more oversold. On the weekly though there is a chance for a further decline. Given the passed month of almost range trading (bound between 1.31 and 1.37) we shouldn't be surprised if there is another one like that to follow. But the drama comes near its end so a higher volatility shouldn't be a surprise.

The daily graph is somewhat contradictory as MACD is on the negative side for the Euro while Stochastic is pointing upward. The day started high for the Euro and later it lost almost a cent against the US Dollar. There is a chance for that cent to be recovered but the lower level graphs are still not so supportive.

In short term there are some bullish divergences seen on the graphs shorter than 1 hour and there is a chance for an explosive increase of the Euro value against the US Dollar especially after the Euro gets in oversold area on the 4 hour graph.