By Yasuhiko Seki and Kazumi Miura
Dec. 11 (Bloomberg) -- The euro is poised to decline to a three-month low of $1.4446, Gaitame.com Research Institute Ltd. said, citing trading patterns.
The 16-nation currency, which climbed to a one-year high of $1.5144 last month, has entered a near-term downtrend as the spot price has fallen below its 60-day moving average, said Tsuyoshi Okada, managing director at the research unit of Japan’s largest foreign-exchange margin dealer in Tokyo.
“The charts are now showing signs of change for the euro, and herald an end of its rising trend,” Okada said. “Should the decline of the euro gain traction, the immediate target will be mid-$1.46 and the next target will be the $1.4446 level.”
The euro traded at $1.4732 as of 9:34 a.m. in Tokyo from $1.4732 yesterday in New York. The currency has declined 2.7 percent since reaching a 15-month high on Nov. 25.
The single currency last traded below $1.4446 on Sept. 8. “This level has served as a key resistance level for the euro’s rising trend that began early this year and lasted until August,” Okada said. A resistance level is where sell orders may be clustered.
The euro’s 60-day moving average was $1.4844 yesterday, according to data compiled by Bloomberg. The currency remained above the average from Aug. 19 until Dec. 4.
In technical analysis, investors and analysts study chart of trading patterns and prices to forecast price changes in a security, commodity, currency or index.
To contact the reporters on this story: Yasuhiko Seki in Tokyo at Yseki5@bloomberg.net; Kazumi Miura in Tokyo at kmiura@bloomberg.net.
Last Updated: December 10, 2009 19:49 EST
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