This week the EURUSD sort of moved choppily upwards, and ended the week with a big move down to end up pretty much where it started. Behold the weekly candle:
(Weekly EURUSD chart)
The long upwards wick on this candle and close below last weeks closes suggests continued bearish movement.
So I may not be that great at predicting price movement from charts, but it is a lot of fun to review them later
and see where price fits into the various technical indicators.
(Daily EURUSD chart, 100 & 200 period moving averages set to CLOSE)
See how last weeks price action (the last 5 bars of this chart) flirted with the 100 period simple moving average?Amazing!
(Daily EURUSD chart, 100 period moving averages set to HIGH & LOW)
The HIGH and LOW of the 100 period simple moving averages are similarly interesting, and I'm impressed with how often price flirts with these lines on various time frames. Here we can last weeks price action was contained between both of these lines! The move up Thursday reversed from the 100 HIGH and move down Friday stopped at the 100 LOW. Astounding!
(Daily EURUSD chart, Ichimoku Kinko Hyo)
Ichimoku Kinko Hyo is fast becoming one of my favorite charts to look at because price seems to respect the various levels presented nicely. Here we can see price hit the blue line and bounced down, but not quite able to exit the "cloud".
Ok, so all of this is fascinating, but it doesn't tell us where the price may go next. Many technical indicators are pointing towards a bearish move (moving averages, weekly trend line, etc). However several other currency pairs have been trying to break higher, and if they succeed, may drag the EURUSD higher as well.
Also, while technically it looks like EURUSD should move lower, if we expect the unexpected, it will move higher. Gah!
Let's look at another chart which might help explain EURUSD indecisiveness:
(Daily EURUSD chart, 100 period Bollinger Bands, 1 & 2 standard deviations plotted)
If you excuse my poorly drawn yellow trend line, we can see a triangle forming in conjunction with the strong support level of 1.30 which price has so far 3 times failed to break through. Also, price is consolidating between the 1 standard deviation lines of the 100 period Bollinger Bands.
So EURUSD price has been erratic lately, but generally it is moving lower, but stalling above 1.30. It's not sure where to go, but doesn't want to move higher, but also doesn't want to break lower.
It's winding itself up for a big move. I'm guessing down, but we'll have to see if the 1.30 level holds, and also see what the other currency pairs are up to.
