Forex4you Technical Analysis 02 May 2013

EUR/USD: Bearish signs, ECB on tap

Eurodollar has stalled in its up-trend and formed a bearish shooting-star candle on the daily chart. On the hourly chart there is a head and shoulders pattern with a neckline at 1.3145. If the pair breaks below the neckline it will probably move down towards the trend-line at 1.3085. Alternatively it is possible the up-trend could resume again, with a break above 1.3200 seeing the start of a recovery to the upside, although for more confirmation it would have to move above 1.3225, then targeting 1.3325. Today's ECB rate meeting could cause short-term volatility and dictate the future direction of the trend.

USD/JPY: Consolidating in a Triangle

The USD/JPY pair has stopped falling and is currently consolidating in a triangle on the intra-day charts. It will probably eventually break down out of the triangle and continue lower. The only problem is the monthly pivot and support and resistance grouped at 96.66, which could resist further downside, however a decisive break below that level would probably lead to 95.80-90s reached near the neckline of the possible double top. A break of the neckline could then in turn lead to a further possible move lower into the territory of the 92s. Alternatively given the broader up-trend a break above 97.55 could give a potential upside target of 98.30.

Analysis By: Joaquin Monfort, Forex4you Analyst

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