EUR/USD: Odds Favor Sideways To Up
Al Brooks | Oct 10, 2022 09:44AM ET
- EUR/USD bear have done a great job disappointing the bulls creating a big up, big down situation. The odds favor sideways when you have a big move up followed by a big move down.
- Bulls see this current selloff as a pullback from the October 4 rally.
- Bears see the October 4 rally as a pullback from the bear breakout that started in late September. They also see the current selloff as the start of a trend resumption down.
- The problem the bears face is that the market is in a broad bear channel with decent buying pressure developing. Channels evolve 75% of the time into trading ranges, which means the odds favor sideways to up soon since this bear channel has lasted so long.
- The selloff over the past four days is strong enough that the bulls will need some double bottom before they can get some second leg up from the October 4 rally.
- Bears want to continue to create an endless pullback and break below the September lows.
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