Tuesday, October 18, 2011

EURUSD outlook for Short term 18th Oct 2011

EURO: Support 1.3490 – 1.3660 – 1.3760

Pivot 1.3830 Resistance 1.3930 – 1.4005 – 1.4175

Euro: Looking at the chart Euro is in formation of Inverted Head & Shoulder Pattern where it’s just reverted from the previous resistance level of 1.3940 which it tested in mid June and sharp selloff was seen thereafter and tested the level of 1.3145 which was the formation of Head. Left shoulder started from 1.4550 and after testing the bottom of 1.3500 reverted and tested 1.3940 from where neck line started. Sharp reversal in price was seen after testing 1.3145 levels and it’s near to the neck line area of 1.3913 days high. If the closing is seen well below the days high of 1.3913 level will confirm the pattern formation where on immediate basis it may move to test the level of 1.3500 – 1.3550 area once. Further we look to see some reversal in price from 1.3500 area and again move and test the neck line and further breakout above the neck line above 1.3900 will give sharp rise in price where 1.4400 – 1.4550 can be the upside target. We need to keep close watch on EURUSD giving closing below 1.3450 on weekly basis which will disqualify the pattern formation where next support may be at 1.3150 can be tested, may forming Double bottom formation. Stochastic which are trading in overbought zone has given negative intersection and if trading is seen below 80% zone will bring it to lower level with fall in price what we are expecting it to test the level of 1.3500 in near term.

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