Choppy Waters Ahead for the Euro!

10:00 GMT

The benchmark Euro pair is headed for a cascading waterfall in the coming week as its recovery attempt was cut short by a stiff 1.4935 resistance. The pair remained range-bound this week. It formed a Hanging Man candle pattern in yesterday’s trading session, which was confirmed obvious with a Bearish session in today’s trade.

The trend line is already sloping downward with the pair making lower successive highs. Worse still are the 4-hourly charts as the pair has lost its long term upward momentum with the indicators turning pessimistic as well. Candles are currently trading below the 200 day EMA favoring fresh downward bias. RSI is already headed downwards below its centerline, currently at 46.34. Strength in the Greenback due to concerns of a potential bubble in assets and a double dip recession in late 2010, is also favoring the Bearishness of the pair.

The upside looks limited as it is progressively failing to break resistances. A downside rally appears certain [cross your fingers!] with the pair looking bearish in longer term charts.

The pair is currently trading  marginally below centerline of the Bollinger bands and below its 14 day EMA, showing that it is headed southwards in the week to come.Traders can go short for the coming week, with a target of 1.46252 (Stop Loss: 1.47227) in mind.

EURUSD