EUR/USD: Intraday Technical Analysis for August 2, 2012

Weekly Pivot Point: 1.2251.

Time Frame: H1


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Trading Recommendations:

Intraday Forecast

According to the previous events, the price is still located between 1.2389 and 1.2215.
Buy deals are recommended above 1.2235 with the targets seen at 1.2285 and 1.2403 levels.
Look for further downward movement below 1.2460 with the first target seen at 1.2403 and 1.2315 levels.

Overview:

The EUR/USD pair has broken the resistance level and turned towards the support level near the two week point of 1.2113 (July 25, 2012). Therefore, the pair has already formed a strong support at 1.2113. Moreover, having failed to close below 1.21, the pair started showing a bullish reaction at this level. It is necessary to mention that these levels coincide with strong levels for bulls on H1 chart; the pair has also formed a strong support at the level of 1.2113//1.2235. So, the pair will move upwards which is a convincing fact; the structure of the upside movement looks as non-corrective indicating a bullish opportunity above 1.2200. This can be a good sign for buy deals above 1.2113/1.2235 with the first target at 1.2285 initiating an uptrend in order to continue the bullish mood towards the point of 1.2403 and further to 1.2455. If the trend breaks the weekly pivot point (1.2251), then the pair will go upwards in these targets. However, it should also be noted that the price is still between 1.2389 and 1.2215, as the Stochastic and the last strong resistance level are still able to begin a downtrend at this level. So the market indicates a bearish opportunity at the level 1.2460 on H1 chart with the first target 1.2403 and continues towards 1.2315.

Observation (s):

• If the trend is ascending, then the strength of the currency will be defined as following: EUR is an uptrend and USD is a downtrend.
• Most of the traders use the Fibonacci retracement to determine accurately the psychological support and resistance levels.