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EUR/USD Weekly Review 3 July 11

, 07-03-2011 at 11:19 AM (804 Views)

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[FONT=verdana]Good day forex trading koalas.[/FONT]

[FONT=verdana]In the previous EUR/USD Weekly Review, we noted from a technical analysis point of view that the SMA 20 is still above the SMA 50 and hence a cross over would be more of a confirmation. Furthermore the previous upper trendline of a bearish channel continues to provide a sizable support for any bearish exploitations. From a fundamental analysis point of view, both the American and Euro Zone economies face respective challenges and the recoveries face the threat of a derailment.[/FONT]

[URL="http://3.bp.blogspot.com/-R3_xwwNtA-8/ThA_-Cl4BgI/AAAAAAAACzA/cfYB4YFigIQ/s1600/1.jpg"][IMG]http://3.bp.blogspot.com/-R3_xwwNtA-8/ThA_-Cl4BgI/AAAAAAAACzA/cfYB4YFigIQ/s400/1.jpg[/IMG][/URL]

[FONT=verdana]Technical Analysis:[/FONT]

[FONT=verdana]Looking at the EUR/USD Daily chart above, as mentioned last week the upper trendline of the previous bearish channel continues to function as a support. The currency pair bounced off the line and embarked on a bullish climb towards 1.46. This was also a result of the region of 1.42 holding it's fort.[/FONT]

[FONT=verdana]SMA 20 = Downwards, flattening[/FONT]
[FONT=verdana]SMA 50 = Downwards, flattening[/FONT]

[FONT=verdana]I mentioned previously that having the SMA 20 crossing below the SMA 50 in a bearish momentum would be a stronger confirmation. It did not happen and since then, the EUR/USD had climbed into an ascending momentum. The SMA 20 is now above the SMA 50 and i will be looking out for both SMA 20 and SMA 50 to round the bottom and point upwards. As the 1.46 region is a strong support area, care must be employed. Early June also saw the EUR/USD failing to penetrate this region.

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