2-16-10_dx_4_hr.gifThe eur/usd is still a very nice trade. We have retraced 50% of the 4 hr move and the dollar index seems to be cooperating:
I dont think the dollar index is overbought yet. If we look at the DX 4 hour chart, we can see the price is being supported by the 50 ema and the trendline. It seems we could very well bounce from here on the dollar index. One thing we know tho is if the DX doesnt bounce and closes a 4 hr chart below the 50 ema then price could very well test the next TL support.
 So looking at the EU 1 hr chart, price is coming up on TL resistance. My suspicion is the eu may test the tl resistance and begin to decline just as the dx bounces from the current TL it is resting upon or even the 50 ema allowing it to head back up, pushing the eu down.