Introduction
EUR/USD has teased the resistance level at 1.2310 a number
of times, but it has been unable to break it. At the same time, it has been
forming a slope of higher lows. As a result, the common currency has formed a
nice-looking ascending triangle pattern.
Factors Affecting
It seems the euro zone debt problems have not raised their
ugly head in the market for sometime now. Today, the current account from the
euro zone gave a reading of 10.9B against a projected value of 5.3B. As a
result, this positive data made the demand of the euro to rise in the market.
Nonetheless, traders are still keen on any news updates about the euro zone
debt situation.
Technical Analysis
Technical analysis on the EUR/USD reveals it is has formed
an ascending triangle pattern. If the pair convincingly breaks out of the
pattern to the downside, it may drop to the support level at 1.2170. On the
other hand, if the pair convincingly breaks out of the pattern to the upside,
it may test the resistance level at 1.2370.
Forecast
Currently, the pair is on a downtrend in the short term.
Therefore, aggressive traders should just wait for further confirmation before
going short on the pair.
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