Friday, October 4, 2013

Single Currency bounces off resistance


Despite the shutdown of the US government the Euro versus US dollar pair (EURUSD), which is the most heavily traded of those that involve the greenback, has halted in its rise overnight (European time). The level at which this has happened is significant. There is a resistance line at around 1.36488, which is such that it would have been carefully watched by participants. This can be clearly seen on the weekly chart (below):

All over the world there are traders who are watching levels such as this. You should be too. It may not hold, but if it does not, this will also be a significant development as the rate will tend to accelerate upward as a consequence of breaking through the resistance.

Events involving the authorities in the USA will have a bearing on this.

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