Euro May Decline to $1.5224 on Charts, Forecast's Ng Says

By Stanley White

Aug. 7 (Bloomberg) -- The euro may decline to $1.5224 against the dollar in the next two weeks, said Pak Lai Ng, a technical analyst at Forecast Pte in Singapore, citing charts traders use to predict price movements.

Support at $1.5224 is the single European currency's average price for the past 200 days. The euro is likely to decline as its weekly stochastic and moving average convergence/divergence charts are showing sell signals, Ng said. The currency also has a bearish trend after breaking below its 100-day moving average, he said. Support is a level where buy orders may be clustered.

``We may see the occasional bounce in the euro, but the big picture is for it to head lower,'' Ng said. ``The 100-day moving average was good support for almost all of last year. As long as we remain under that level, the euro looks weak.''

The euro bought $1.5433 at 10:58 a.m. in Tokyo from $1.5408 late yesterday. The 15-nation currency has fallen 3.8 percent since reaching a record high of $1.6038 on July 15.

MACD charts indicate whether a price shift is a change in trend or a short-term deviation by comparing moving averages over different periods.

In technical analysis, investors and analysts study charts of trading patterns and prices to forecast price changes in a security, commodity, currency or index.

To contact the reporter on this story: Stanley White in Tokyo at swhite28@bloomberg.net