Technical Trading Tips and Techniques by 
(Please click on the accompanying chart to enlarge.)
As I had written on this blog a couple of days ago (click here for that post), price on the EUR/USD 4-hour chart (as shown) has been “traversing a down channel”. Though price rose and then dropped substantially after that, breaking down below the 1.4000 psychological support barrier in the process, the pair is still entrenched in this rather steep downtrend channel as of early Thursday morning in New York. Currently, price is hugging the bottom of this channel. A pronounced bounce here should target immediate resistance back up at the 1.4000 support/resistance area once again. In the event of an impending break below the bottom of the channel, on the other hand, price should target immediate support around 1.3850.
- James
James Chen is the Chief Technical Analyst at FX Solutions, a leading Forex broker. He is also a registered Commodity Trading Advisor (CTA) and a Chartered Market Technician (CMT) Level 3 candidate. At FX Solutions, Mr. Chen writes daily currency analysis, conducts forex trading seminars, and has authored numerous articles on currency trading and technical analysis for major financial publications. His upcoming book, Essentials of Foreign Exchange Trading