ForexPros Daily Analysis April 13, 2010
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Fundamental Analysis: Fed Chairman Bernanke Testifies
Traders of the US anticipate the testimony by Ben Bernanke, US Federal Reserve Chairman. He will be testifying in Washington DC, regarding America's economic outlook and financial markets.
His comments may determine a short-term positive or negative trend.
The Euro retreated from the post-gap top, and filled more than a third of the gap. This normal retreat after the sharp rise from 1.3281 has not done any harm for the technical outlook, since the price is still above the broken line with a comfortable margin. But the fragile consolidation above 1.3567 makes us expect more downside activity, immediately after it is broken. If this support gives way, the Euro will fall further, targeting two important levels: the first of which is the gap filling level at 1.3495, and the second has a huge importance for the short and may be medium term as well, since it combines Fibonacci 61.8% and the broken trend line which we said it is very important to stay above, in order to achieve more gains. The resistance is at 1.3643 and only if it is broken, we can expect more gains, and a new weekly high, since the targets for such a break will be 1.3709 & 1.3794.
• 1.3667: Asian session low gap filling level. 38.2% for the rise from 1.3281.
• 1.3495: filling the gap level.
• 1.3437: Fibonacci 61.8% for the rise from 1.3281.
• 1.3643: short term Fibonacci 61.8%.
• 1.3709: Fibonacci 23.6% for the whole drop from 1.5143 to 1.3266.
• 1.3794: Mar 12th high.
The falling trend line from 94.77 frustrated another attempt for the Dollar-Yen to rise, stopping it at 93.59. Then we saw the price obey the trend line and dropped almost 100 pips, entering the 92 areas. The thing is that, the technical outlook has not changed for days. We are still trading very slowly in a correction to the up move which topped at 94.77, which is a correction that managed to reach its first target at 92.85. We are still watching for any other technical evidences to decide whether this correction has finished at Fibonacci 38.2% or that it is still going and will soon target Fibonacci 50% & 61.8% levels. Support is at 92.26 and in case it is broken, the price will continue its drop from 94.77 (the correction), and will target the most important support for the short term (and may be the medium term as well) 91.66, and if broken we will target 91.07 as a modest target for such a break on the way to lower targets. As for the resistance it is at 93.26, and breaking it would indicate that we are back to the 94areas after completing a modest correction, and we will target 94.07 & 95.05.
• 92.26: Fibonacci 50% for the rise from 89.74.
• 91.66: Fibonacci 61.8% for the rise from 89.74, a very important support for the short term.
• 91.07: Mar 12th high.
• 93.26: the falling trend line from 94.77 on hourly chart.
• 94.07: important intraday support/resistance.
• 95.05: Aug 24th high.
Forex Trading Analysis written by Munther Marji for ForexPros.
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