(Bloomberg) -- The euro may extend its advance against the dollar to $1.4718, the strongest level since December 2008, Ueda Harlow Ltd. said, citing trading patterns.
The euro’s uptrend versus the greenback is evident, with the 16-nation currency staying above the top line of the ichimoku cloud on a daily and weekly basis, Toshiya Yamauchi, manager of the foreign-exchange margin trading department at Ueda Harlow, said in Tokyo.“This currency has a tendency to extend its gains once the deviation from the 21-day moving average line tops 1 percent, which has just emerged,” Yamauchi said. “Looking at these key charts, the chance of testing the December 2008 high of $1.4718 is now looking to be reasonably high.”
The euro traded at $1.4290 as of 7:58 a.m. in Tokyo from $1.4304 in New York yesterday as it stayed above the 21-day moving average of $1.4232. The currency reached $1.4447 on Aug. 5, the highest level since the start of this year.“The Aug. 5 high is likely to be seen as a psychologically important level in the near term,” Yamauchi said. “But there is no technical reason to believe that the current advance of the currency will come to a full halt at this level.”An ichimoku chart analyzes the midpoints of historic highs and lows. The conversion line is the same calculation over the past nine trading days. The baseline on the ichimoku chart is the sum of the highest high and the lowest low over the past 26 trading days. A lagging span is the most recent closing price plotted 26 days behind the current level.
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