FX.co ★ Candlestick analysis of the EUR/USD for 28/10/2010

The EUR/USD currency pair makes a small rollback after a sharp fall. Nevertheless, the sight on the currency pair remains bearish. As it was pointed out earlier amid breaking through the support level at 1.3696 then the downward movement is possible with the target at 1.3382, where Fibonacci correction level 50.0 is fixed.

Earlier at 4-hour graph the EUR/USD has formed the Shooting Star candlestick which comes as a bearish signal.

This candlestick was formed at an upside trend. However, near the January maximum of 2010 the "bears" started increasing their influence and a rollback took place.
A break through of Fibonacci correction level 23.6 and the support level at 1.3777 means that the up-going trend is overcome and that this supposition is correct. In favor of the down-going comes the fact that at a day graph the EUR/USD shaped the Dark Cloud Cover candlestick combination.
In addition, at 4-hour graph "Head and Shoulders" figure is probably forming. A break through of the "Neck" will be a confirmation.
On the other hand, if the resistance level 1.4079 will be broken through then short positions should be closed, as it will lead to a rise to 1.4157.