Forex Technical Update
EUR/USD 4H Chart 9:42AM EDT 6/19/2012
The EUR/USD continues to mirror last week's action, which also started with a pop and an immediate fading of risk during the Monday session. After that, the market spent the rest of the climbing back up the week-high near 1.2666. As we wrapped up this week's Monday session, the EUR/USD also started to climb.
For the 6/19 session, the 1.2660-1.2670 area (last week's high) will be a challenge. Above that the 1.2750 area, just above this week's high at about 1.2745 will be a challenge ahead of the FOMC meeting tomorrow, unless the market gets the idea that QE is a real possibility. I tend to believe that Bernanke will disappoint.
Still, the short-term 1H, 4H charts show that the market is bullish, and even though the structure of June's rally is corrective compared to May's decline which looks motive in nature, there is still upside toward 1.2820, 1.30 area, before the next panic-inducing headlines.
The bearish outlook is held off until we break below the rising correction trendline. At this point a break below 1.2550 might be the first sign. A break below 1.25 would be a more clear sign of a break to the downside, which opens up the 1.2285-1.23 May-June lows.
Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist of FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.
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