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EUR/USD Weekly Review 26 June 11

, 06-26-2011 at 11:10 AM (640 Views)

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[FONT=verdana]In the previous EUR/USD Weekly Review, we noted that from a technical point of view we might be heading into some consolidations. The near by trend lines and almost flat Simple Moving Averages suggested that. Fundamentally, the concerns regarding the Greek deficit remains strong as Euro Zone leaders continued to push for an agreement regarding a new bailout package. In the US, depressed equities and a low home sale pricing market added fuel to the fires of a negative outlook.

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[URL="http://3.bp.blogspot.com/-saO1L13HciA/TgcEpDj9rNI/AAAAAAAACyk/UYfaK5J080Y/s1600/1.jpg"][IMG]http://3.bp.blogspot.com/-saO1L13HciA/TgcEpDj9rNI/AAAAAAAACyk/UYfaK5J080Y/s400/1.jpg[/IMG][/URL]
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As per mentioned in the previous EUR/USD Weekly Review, we note above that the consolidation scenario did play out in the end. After testing the strong resistance of 1.44, the currency pair headed to close the week around 1.42, a strong region itself.[/FONT]
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I tweaked the Simple Moving Average technical indicators to follow a more commonly used period.[/FONT]
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SMA 20 = Rounding a top downwards[/FONT]
[FONT=verdana]SMA 50 = Gentle downwards[/FONT]
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From a technical point of view, closure below 1.42 is a bearish suggestion. Having said so, we note that the SMA 20 ( indicator for possible near term movement ) is still above the SMA 50 ( indicator for possible medium term movement ) and a cross will probably bring about more confirmation. Not forgetting that the previous down slope trend line continues to provide a support for possible bearish drives.

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