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Chart of the Day - 7/30/2008 - EUR/USD
7/30/2008 – EUR/USD – As of this writing, EUR/USD (the daily chart of which is shown) has hit a key dynamic support level in the form of a relatively long-term uptrend support line. This trendline, denoted by the long green line labeled “A”, has been an active support line for around a year, since August 2007 when price was around the 1.3350 region. Price has revisited this line several times since then, and just today has threatened a breakdown. If indeed a true break occurs with significant downward momentum, we should be seeing price ultimately target the next major support level to the downside around the 1.5350 region, which is near the bottom of the horizontal range that price has been entrenched in since March. On the other hand, oscillators like the displayed Stochastics are showing well oversold, indicating a potential waning or stalling of downward momentum. If this is the case, and price turns up around the uptrend support line (even if there is a slight false break), immediate resistance to the upside resides around the 1.5630 region, which is the prior support level that was broken during yesterday’s bearish price run. * Visit my forex tips and techniques blog here: [url]http://fxpath.fxstreet.com[/url] * James Chen Chief Technical Analyst FX Solutions IMPORTANT NOTICE: These comments are for information purposes only. The information contained on this document does not constitute a solicitation to buy or sell by FX Solutions, LLC., and/or its affiliates, and is not to be available to individuals in a jurisdiction where such availability would be contrary to local regulation or law. Opinions, market data, and recommendations are subject to change at any time. Forex trading involves substantial risk of loss and is not suitable for all investors. (Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; uptrend lines in green; horizontal support/resistance lines in yellow; 200-period simple moving average in light blue.)