EURo/ USD "the Week Ahead"
There are a fiew reasons that i think the Euro/Usd is going to go lower next week:
-First and formost the traders sentiment is still very negative after EU officials have pointed out the need of future stimulus program for the Euro zone. That leads to my personal opinion that every week that the ECB does nothing to restore confidence will result in a lower euro.
-The second reason i thing the Euro is going lower (atleast for next week) are a fiew of the chart formations that occur on the daily and four hour charts..
1. The first chart that i am going to show you is the 4 hour chart on the Euro/ Usd.. It has only trend lines so we can clearly see the direction of the market for the last week.As we can see we have a nicely formed upward channel.. But dont let this steady move to the upside fool you for a second.. This move is actually a correction that began from the lows of 1.2060 !! The fact that we are in an upward channel in the worst period for the euro zone in my oppinion makes the next move to the downside potentially very fast and big..
2. The second chart that i am going to show you is the 4 hour chart of the Euro/ Usd but with all the indicators that i use on it.
From my point of view the puzzle is very clear for the week ahead. As we can see from the chart we have broken trough every support line from the last week and retest it as resistance (the central weekly pivot the 200MA the 50MA and the 21 EMA). I can explain this chart to myself i a couple of ways: In the beginning of the week we can have a short test of those levels again before moving down or just a sharp move down. Eather way we have to look for a clean entry to the downside..
3. And the third chart that i am going to show you is the daily chart of the Euro/ Usd..
From this chart i can see that a downword move has already started and broken all the near term support levels.. Also from my indicators i can see that the ADX is turning and with it the MACD is turning combining that with the the fact that we are below the 21 EMA makes it the perfect combination for me to go short with the stop just above the 21 EMA and target somewhere around the monthly median..