Euro Technical Analysis – August 23, 2012
The EUR/USD pair broke through the 1.25 level on Wednesday after the Federal Reserve released minutes from the July meeting. This suggested that there were several people on the board that were willing to engage in monetary easing if the US economy doesn’t pickup, and as such the market sold off the US dollar.
However, we are currently at the top of the rising wedge we’ve been following, and there is a ton of resistance all the way to the 1.27 level. Certainly, over the last couple of sessions we have seen the Euro overbought, and as such we are looking for some type of weakness to sell. We haven’t got thet yet, but we think that it’s coming. With this in mind, we are looking for a sell signal on the smaller time frames that line up with our rising wedge.