EUR/USD: Exhaustive Selloff, Upward Reversal Likely
Al Brooks | Sep 30, 2022 09:29AM ET
- EUR/USD bulls got a strong reversal two days ago; yesterday, they now have bear bar closing on its low.
- Though the September 26 bar is a lousy signal bar, the two consecutive bull trend bars closing on their highs are enough to think the bears will probably give up soon.
- The targets for the bulls would first be the September 20 and September 12 highs.
- At the moment, the market is testing the September 6 breakout point. The bears want to defend the open gap hear and create a measuring gap and break below the September low.
- However, the odds favor the September 6 breakout point gap closing soon.
- While the bulls want the market to go straight up from here, the market may have to have after the 6-bar bear micro channel.
- The odds favor the market going higher and the bear trend on the daily chart entering a trading range; however, traders do not know if this is the start or will the market have to test the September lows first.
- Bulls may try to buy a 50% pullback of the past three days (including today’s range).
- While the bears may not be eager to sell below today, if they get two legs up and a decent bear bar closing on its low, the bears will sell.
- Traders will pay close attention today to see if the bulls can get continued follow-through today or if the bears can disappoint the bulls and get a bear body or one closing on its low.
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