FX.co ★ The candlesticks analysis of the EUR/USD for November 02, 2010

At 4-hour chart, the EUR/USD currency pair shows the sideways movement. However, the viewpoint on the currency pair remains bearish. As it was mentioned before, the breakout of support level of 1.3696 will lead to the downwards movement with the target at 1.3382, where the Fibonacci correction level 50.0 is placed.
Earlier on a 4-hour graph, the EUR/USD has formed Shooting Star candlestick, which is a bearish signal.
This candlestick emerged on the uptrend. However, the bears started to increase their influence and a rollback took place near January 2010 low.
The breakout of Fibonacci correction level 23.6 and support level of 1.3777 denotes the breakout of the uptrend and confirms this viewpoint.
The downside motion is also confirmed by the fact that the EUR/USD has formed the combination of candlesticks Dark Cloud Cover on a daily chart.
Moreover, a pattern “Head-And-Shoulders” is, probably, forming on 4-hour graph. The breakthrough of the “neckline” will confirm this fact.
In case the resistance level of 1.4080 is breached, the short positions should be cut, since it will lead to increase to 1.4157.