(Bloomberg) -- The euro may extend its rally to a seven-month high against the dollar within two weeks after the currency rose above resistance at $1.4120, said Pak Lai Ng, a technical analyst at Forecast Pte, citing trading patterns. Resistance at $1.4120 represents a descending trend line on a so-called triangle pattern, Ng said. The triangle is formed by the descending trend line, which connects the highs of June 3 and July 1, and by an ascending trend line, which connects the lows of June 16 and July 8, according to Ng. Resistance is where sell orders may be clustered.“The euro has broken the triangle pattern to the upside,” Singapore-based Ng said in an interview. “It should see quite a quick run-up. The target is $1.4650.”
The euro fell to $1.4213 as of 12:35 p.m. in Tokyo from $1.4231 in New York yesterday, when it advanced to $1.4249, the highest level since June 5. The currency has risen 2.7 percent against the greenback since dropping to a two-week low of $1.3833 on July 8. The $1.4650 level was last seen on Dec. 18.Daily momentum indicators such as the moving average convergence/divergence, or MACD, also show a buy signal for the euro against the dollar, according to Ng. “All of them are positive,” he said.The euro’s MACD versus the dollar was 0.0062, compared with 0.0043 for the so-called signal line, based on data compiled by Bloomberg. A rise of the MACD above the signal line suggests the currency is in an “upward” trend, Ng said.
MACD charts can indicate whether a price shift is a change in trend or a short-term deviation by comparing moving averages based on nine-, 12- and 26-day periods.In technical analysis, investors and analysts study charts of trading patterns and prices to forecast price changes in a security, commodity, currency or index.
No comments:
Post a Comment