Tracking the EUR/USD Pair : 07.02.2012

[RealForex]

Date: 06.02.2012 Time: 20:34 Rate: 1.3131

Daily Chart

A quote from Yesterday’s review

During the last trading week the price has stayed between the limits of the 1.3077 support level and the 1.3210 resistance, while almost every day the price has reached to both of those levels but could not close the candle above or under them. It is possible to assume that a closure of a candle with most of its body is under the 1.3077 price level will send the price to a correction in size of between a third (38.2%) and two thirds (61.8%) of the uptrend began from the 1.2625 price level. On the other hand, breaching the 1.3210 price level in a proven way will sign that the price will make it way towards the 1.3440 which is the 50% correction level.

Current review for today

Yesterday was another day that joins the last seven candles in which the price is ranging in the range of between the 1.3077 and the 1.3210 price levels, the price started the week under the closure of the previous, we have seen a sharp descending move and then the buyers came back into action and pushed the price back to the center of the range. The difference between this day and its previous is the fact that the price did not reach the higher lip of the range, is that a clue to for the future? we think that only a closure of the candle above or under the mentioned levels will define the direction of the price for the short term.

4 Hour Chart

Current review for today

On the following chart you can see clearly the range between the 1.3050 and the 1.3220 price levels with the price located exactly in the middle in the time of writing those lines, as if it were saying that the decision is not easy and the direction is not defined. In those situations of a long ranging period when the direction is finally determined, the price will speed up as if it was fired by cannon. There are cases in which the price can have false breaks, but after the clear definition of the price, it is probable to see a fast movement towards one of the directions shown in the chart.

Important announcements for today:

3.30 (GMT+0) AUD – RBA Rate Statement
13.30 (GMT+0) CAD – Building Permits (Monthly)
15.00 (GMT+0) USD – Fed Chairman Bernanke Testifies