New book by Larry Connors Click here Improve your trading - See how
Dollar's recent decline resumes in early US session after retail sales came in much worse than expected. Headline retail sales unexpectedly fell -0.9% in Jun, lowest in 2 years, dragged down by sharp declines in auto sales, furniture and building supplies. Ex-auto sales also dropped -0.4%, lowest growth in almost a year. Markets expected mildly growth of 0.1% and 0.2% respectively. Dollar is sent to record low against Euro and fresh 26 years low against Sterling immediately after the news. However, stronger than expected growth in import prices at 1.0% versus consensus of 0.7% is providing some support to the greenback.
EUR/USD
Daily Pivots: (S1) 1.3753; (P) 1.3776; (R1) 1.3811; More
EUR/USD surges to another new record high of 1.3812 in early US session. But still, upside is limited by key medium term resistance at 1.3822. Upside momentum remains unconvincing with mild bearish divergence condition in 4 hours MACD and RSI. But after all, there is no confirmation of a top yet. Further rally is still in favor as long as 1.3729 support holds. On the downside, below 1.3701 will suggest that a short term top could be in place already. Deeper decline should then be seen towards 4 hours 55 EMA (now at 1.3664 first).
In the bigger picture, the strength of the current rally from 1.3262, which is relatively stronger than prior rally from 1.2865 to 1.3681, is putting doubt on prior mentioned case that rise from 1.3262 is the last rally in a five wave structure that started at 1.2483. Also, daily MACD has broken its falling trendline, negated the bearish divergence condition which suggested loss of upside momentum. Nevertheless, Euro is now in an important resistance zone between 1.3766 and 1.3822 and focus will still be on reversal signal. but a break below 1.3567 support is needed to indicate the rise from 1.3262 has completed first before considering the chance of a medium term top being in place.
Also, as discussed before, whether medium term rally rally from 1.1639 represents resumption of multi-year up trend from 0.8233 remains in question. But a sustained break of 1.3822 fibo resistance will add much weight to this case and path the way towards 95 high of 1.4523 in medium term.
Read full report (EUR/USD, GBP/USD, USD/CHF, USD/JPY, EUR/JPY) here.
Shing-Ip Tsui is the founder and CEO of www.ActionForex.com. ActionForex is set up with the aim to empower individual forex traders by providing insightful contents. Analysis reports, live pivot points on majors and crosses, etc are provided with collection of carefully selected educational articles and free trading ebook downloads.
About TradingMarkets | Contact | Advertise | Careers | Link to Us | Site Map | Help | Terms & Conditions | Privacy Policy | Return Policy | Testimonials | Feedback
The Connors Group, Inc. ("Company") is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. The analysts and employees or affiliates of Company may hold positions in the stocks, currencies or industries discussed here. You understand and acknowledge that there is a very high degree of risk involved in trading securities and/or currencies. The Company, the authors, the publisher, and all affiliates of Company assume no responsibility or liability for your trading and investment results. Factual statements on the Company's website, or in its publications, are made as of the date stated and are subject to change without notice.
It should not be assumed that the methods, techniques, or indicators presented in these products will be profitable or that they will not result in losses. Past results of any individual trader or trading system published by Company are not indicative of future returns by that trader or system, and are not indicative of future returns which be realized by you. In addition, the indicators, strategies, columns, articles and all other features of Company's products (collectively, the "Information") are provided for informational and educational purposes only and should not be construed as investment advice. Examples presented on Company's website are for educational purposes only. Such set-ups are not solicitations of any order to buy or sell. Accordingly, you should not rely solely on the Information in making any investment. Rather, you should use the Information only as a starting point for doing additional independent research in order to allow you to form your own opinion regarding investments. You should always check with your licensed financial advisor and tax advisor to determine the suitability of any investment.
HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING AND MAY NOT BE IMPACTED BY BROKERAGE AND OTHER SLIPPAGE FEES. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER- OR OVER-COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN.
The Connors Group, Inc.
10 Exchange Place, Suite 1800
Jersey City, NJ 07302
© Copyright 2009 The Connors Group, Inc.
