Forexpros.com Daily Analysis, Aug. 12

on August 12 2009 3:32 AM

Join our free webinar - The 1-2-3 chart pattern

Hosted by: Sunil Mangwani

Date: Fri, Aug 14, 2009, 13:00

A chart pattern is a distinct price formation that creates a trading signal, or a sign of anticipated price movements. Chartists use these patterns to identify current trends and reversals and to set buy and sell signals.

Among the different chart patterns, the 123 pattern is a considered to be an effective and successful pattern.

When the 123 pattern occurs at the end of a trend, it is a strong indication of a change in trend. Since price always moves in waves, this pattern can also be found within a trend and within a trading range.

But one must understand the advantages and drawbacks for any trading technique.

Implementing the technique in the live markets is the crucial part and one must have a trading plan defining the precise entry, stop and exit levels.

Learn how to identify this pattern and set the precise trading parameters of entry, exit and stop levels.

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EURO/DOLLAR

A rather tight range yesterday. A break above the 1.4190 indicates a short term break of the range and a target of 1.4220. The target beyond is 1.4320 if the pair continues to push higher.

A break below 1.4100 indicates another swing down with target at 1.4030 and 1.4000.

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USD/JPY

Support is at 95.40 and 95.00. A break below 95 will likely probe into the 94.50 area. There is an upward sloping trend line which currently is running through 95.40. So a move below this level shifts the overall bias for the pair downwards.

Upside resistance is 96.10 and just below 96.60.

Forex trading

analysis by Forexpros.com - Written by Corey Mitchell

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