4-hour timeframe
The total picture:
The price is continuing the downward movement having reached the second resistance level of 1.4380. The formed sale signal is not canceled yet, however, we see that target on Ishimoku is already reached (1.4602). Therefore, most likely, the downward trend will be over and at least correctional movement will appear. On the other hand, there are no signs of reversal and the downward movement is continuing. It is recommended to wait for purchase signal, to analyze its force and just after that enter the market with long positions. Bollinger Bands are down directed that also signals about maintenance of the downward movement. The lines are widening again that means that a lengthening is possible. MACD supports the same tendency. It can not climb to even zero level.
Trading recommendations:
For people, who are in sales now it is recommended to cut short positions as soon as reversal signal appears. For those, who are out of the market it is recommended to wait for purchase signal formation after that to open long positions with the first target of 1.4700. The alternative choice can be sale with the target of 1.4178 if the price strengthens on minor timeframe below 1.4380. In this case, stop loss can be set at 1.4480.
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.
Have fortunate trades,
Stanislav Mikhailovich
December 16, 2009
