NEW YORK (TheStreet) -- The euro/U.S. dollar downtrend continued last week as we can see in the daily chart below. Note that price broke down through 1.2500 key support level before ending Friday just off that level at 1.2521.
This week, we expect more downside price movement, and we will watch any retrace higher for price action sell signals to rejoin the downtrend.
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The Australian dollar/U.S. dollar showed rejection of key resistance near 0.8900 last week, and the market has stayed below that resistance level for the last four weeks on recent attempts to push above it. Last week, price formed a pin bar fakey combo sell signal after rejecting that 0.8900 resistance. This signal implies that price could continue to move lower this week and re-test the key support down near 0.8650.
The U.S. dollar/Japanese yen exploded higher last week and hit its highest level since Dec. 31, 2007 after the Bank of Japan shocked markets with an aggressive expansion of its economic stimulus program, adding fuel to the already hot bullish trend in this market.
We've been discussing recent buy signals in this market that have formed during the last month, and we've been biased toward the upside. We expect more upside in the coming weeks, and we will watch any retraces back to support for price action buy signals to rejoin the uptrend.
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This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.