EURUSD 5/13/09 - New Downtrend or Minor Pullback?

I am currently holding part of a position in a Short I entered today at 1.3637. I have closed out half the position, and am holding the remainder for now to see what happens. Based on my technical analysis of the hourly chart we are now in a minor downtrend. This is confirmed by a lower low being achieved at 17:00 gmt of 1.3566, compared to the last minor down wave low of 1.3588, which occurred an 5/12 at 16:00 gmt. However, on the 4 hour chart, the low of the last down move is 1.3557, so we are still technically in an uptrend on the higher time frame charts. If Price reverses around that level, it would be an excellent time to look for a Long re-entry. However, if Price moves through that support level, I would now consider the Euro to be in a new minor downtrend.

At the time I am writing this it appears that the lower Support levels are holding for now, so this is certainly not a good time to enter Short. Try to wait for Price to retest the level between 1.3570 and 1.3550 for Long entry or wait for price to pullback to around 1.3650 for Short entry.

Happy trading!