EUR/USD: Important Day For Both Bulls And Bears
Al Brooks | May 17, 2022 09:23AM ET
- EUR/USD bulls had a strong rally during the overnight session. The market is now above the May 12 high and back into the 10-bar tight trading range.
- As I said in the prior blog post, the odds favored a failed bear breakout below the 10-bar tight trading range, which is what is happening right now.
- The reversal up is setting up a final flag on the daily chart, and the bulls hope this will give them enough energy to break above the May 5 high.
- The next target for the bulls would be the bottom of the March – April trading range.
- Bulls have a breakout just under the 20-bar exponential moving average, which will be resistance.
- Traders will pay close attention to how today’s bar closes. Will it close as a strong bull bar closing near its high, or will it have a big tail on top, indicating selling into the close.
- If today closes on a high, traders will be eager to see if tomorrow is a strong follow-through bar as well. This would increase the odds of the market becoming always in long and increase the probability of higher prices.
- Overall, today will be an important bar for the bulls and bears.
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