Euro vs. US Dollar May Benefit

Given the uncertainty and confusion surrounding the upcoming confirmation hearings of Ben Bernanke, the Euro versus the US Dollar (EUR/USD) may be a good short term long.

The EUR/USD pair has definitely lost its bullish stride. Side note, may be a reason why the market paused or potentially started the long awaited reversal / pull-back.

If you look at the all-time chart below, you will see that there is good support around the 1.38 level. That is the previous all-time high resistance level, which held until 2007. It is also the 50% Fibonacci retracement level from the lows of 2009 to the recent highs of December 2009.


For now, though, look at a 20 day two hour chart. You can clearly see a sideways pattern, with a clear violation of support around the 1.4268 level.


Trigger: A break of the most recent highs, around the 1.4165 level (look at the five day hourly chart below).

Target: Previous support, with a couple of pips below, at around the 1.4268 level

Stop: Break of the support area around the 1.4097 level.