By: Doug Rosen
The EUR/USD has been dropping for three straight days, I don't expect today to be any different. The more it falls the more others want to get into the action, basically its all about the herd mentality.
On the daily chart timeframe price has been riding down the 5 ema smoothly and gracefully for a few days now. The lower Bollinger band is wide open and pointing down and therefore giving price permission to continue downward.
Of course, for price to continue down, it must pick up more sellers and new sellers will be looking for a bargain price to sell at so I expect price to head up further to touch the 5 ema then to continue its way downside.
On the 4 hour timeframe price has been smoothly riding down along the 5 and 13 ema's with an occasional poke at the 21 so I will be watching for shorts between 1.3524 - 1.3544 since this is the zone between the 13 and 21 ema's and also coincides with the hourly 55 ema overlapped with a 78.6 fib of the last swing down not to mention the weekly S1 pivot at 1.3538 On the 15 minte timeframe the levels I just pointed out also seem to overlap with the 233 ema and the stochastics is in the overbought zone.
The Swissy, which I have always regarded as a reciprocal of the EUR/USD has been making contact with its daily central pivot point and is overlapped with the 50.0 Fib level of its last move up so I do expect buying pressure to occur there which will help out a EUR/USD short. The daily R1 is at 1.3536