Forex Signals - EUR/USD Cautious Selling Ahead

By IBTimes Staff Reporter | December 14 2009 1:15 AM

5:01a GMT - Do you remember my post a few months ago entitled Who uses PipHut?? It was basically a breakdown of the various countries where PipHut is the most popular. However, as I found out last week there was one whole continent that was not being properly accounted for - Antarctica! I know PipHut has only gotten more popular since that post but last Friday when a PipHutter named Tenkis commented that he was stationed near the South Pole and was a daily follower of the site even I was shocked! To prove it, Tenkis took a picture of himself in Antarctica and uploaded it to the forum under the topic World PipHut - click here to view it! Very cool! I would also encourage any piphutters around the globe to upload a pic of themselves with some sort of PipHut printout as well!

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On to today's signal..

Great week for signals last week as the last three have been spot on, complete with nice candlestick signals on multiple timeframes to confirm the trades. Coming into this week the picture is much less clear fundamentally as Dubai has shown progress that they will not default on their loans, many of which are Euro-based. This sort of government-financed security fuels risk-appetite like kerosene on a fire, which would mean positive gains for the EURUSD.

Daily Outlook: However, besides the potential for the pair being oversold, the short-term technical picture for the EUR/USD could hardly have a more bearish trend at the moment, and therefore I am still (cautiously) looking for opportunities to sell the pair on. The pair has broken rising trend support after support recently, the most recent being the lower blue trend line on the chart below (connecting the 12/9-12/10 lows).

Trading Idea: Looking for selling opportunities near former rising trend support (now resistance) just above 1.4700 (which is also the 61.8% fib of Friday's big drop). Because fundamental signals are mixed I will definitely wait for a candlestick confirmation before entering. Targets from 1.4700 are 1.4670, 1.4640, and 1.4605.

(click to enlarge)