Euro and Stock Market Update

Here is a brief look at what we are watching for Friday.

EUR/USD down about 1% on Thursday.  S&P 500 down 1.21% Thursday.

EUR/USD update: The Euro stopped its decline almost exactly at 1.2520, at least so far. If the decline continues below the lows put in (approx 1.2517) then the target is 1.2480-1.2465.  Trend remains down on almost all time frames, although on some shorter time frames it is neutral until those lows mentioned are broken.  This would put all time frames into “down” mode.  Thus, this is important level to watch for short and longer term traders.

Minor resistance comes in at 1.2540-1.2550 followed by 1.2600-1.2610.

Stock Market / S&P 500 update:  With continued volatility the signals are coming in like they normally would over several days.  Based on the daily chart, yesterday I discussed the high of Wednesday being a critical level if we could stay above it… well we opened below and only briefly moved above it before falling dramatically towards the end of the day.  This is bearish.  The candle stick pattern is called a Bearish Harami.    If you pull up a daily candle chart of the SP-500 you will see today’s main candle body is contained within yesterday’s body, but today retraced a significant portion of it.  Confirmation of this pattern is suggested, and would come from a move below 1155 (as mentioned yesterday).  So our levels to watch remain the same as yesterday, we have just thrown in another piece of information.  While I say 1155 is the level to watch, a lot of technicians are watching 1150.  Thus 1155 may be early signal, and 1150 can be used for further confirmation or as another trigger point.  For additional price points to watch please see yesterday’s analysis here.

Cheers,

Cory Mitchell, CMT

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