A more technical look at the markets from InterTrader
After a volatile session, Obama’s Presidential victory pushed the EUR/USD spread betting pair as high as $1.286 on Wednesday.
However, it was only a matter of time before the pair reversed gains and closed in negative territory, as the ECB Chairman suggested Germany’s economy has started a slowdown.
Today the pair has started on positive footing, but no major movement is expected to occur before the ECB announcement at 12.45pm.
EUR/USD Chart
Looking at the chart above, the market is clearly in a downtrend and there is the potential for a double-top formation to take shape.
Conversely, as the moving averages converge and the RSI threatens channel support on the daily chart, the ECB decision could be the catalyst needed to lift the market.
With forex spread betting investors already pricing in additional monetary support, if Draghi talks down the speculation, we could see the pair pushing higher during the day.
For investors, this could be seen as a long-term selling opportunity.
Short positions below $1.281 could target $1.273 and $1.269. Positions above $1.281 will look for further upside towards $1.2875.
Good luck and happy trading
Dafni Sedari, InterTrader
(Original article written 08 November 2012).
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