Day timeframe
Ishimoku:
At the illustration, we can see the downward movement has begun as we forecasted. The price is below Tenkan-sen and Kijun-sen lines and inside of Ishimoku indicator that is actually good for the future perspectives of the downward trend, however, for the movement continuation it needs to strengthen lower that the indicator. Tenkan-sen reversed and is down directed that means the upward trend ending, also the price strengthened lower that pivot level (1.4925). Kijun-sen is also down directed that testifies that the upward movement is likely to be completed. Sale signal is still working out and its target on Ishimoku indicator is level of 1.4307. That is why during the downward movement we have 3 important levels: 1.4620 (Senkou Span B), 1.4401 (the second support level), 1.4307 (final target). At the moment, Tenkan-sen and Kijun-sen lines are the nearest resistance levels. Ishimoku indicator is continuing to move up and is narrowing that signals about possibility that the upward trend will end soon. Chinkou Span is located below the graph that also signals about the sale signal strengthening.
Bollinger Bands:
This indicator is showing the downward movement. The lines are widening and down directed. As we can see, the price strengthened below the middle Bollinger Band that testifies about the downward trend continuation. This indicator is not showing any preconditions for the downward movement cancellation. The possible ending will be seen when the indicator’s lines start to narrow.
MACD:
This indicator is showing the reversal and the downward movement. Now, the most probable variant of developments is the downward trend maintenance.
The trading recommendations:
On the EUR/USD currency pair now the downward movement is likely to continue. The price is below the first support level, but it could not fixate lower Ishimoku indicator. For future deals it is recommended to wait for the tightening up after that to open short positions with target of 1.4401 and further 1.4307. it is possible to place stop loss above 1.4860 level (Kijun-sen).
The picture clarification:
Ishimoku indicator:
Tenkan-sen — red line
Kijun-sen — blue line
Senkou Span A — light brown stipple line
Senkou Span B — light purple stipple line
Chinkou Span — green line
Bollinger Bands indicator:
3 yellow lines
MACD indicator:
The red line and the histogram with the white bars in the indicators window
Good luck in trading,
Stanislav Mikhailovich
December 14, 2009
