EUR/USD: Parabolic Wedge Bottom
Al Brooks | May 30, 2023 09:20AM ET
- The EUR/USD is forming a parabolic wedge bottom (purple line) after testing the March 24th low.
- The bulls want a strong reversal up; however, as I have said several times, the selloff from the May high is tight. This increases the odds that the first reversal up will be minor.
- It is reasonable for the bears to exit above today’s bar due to the risk of the pullback being deeper than what the bulls would want to hold through.
- The market has been in a tight bear channel within a trading range for several bars. Even though the bear channel is tight, traders cannot be in denial if the bulls start to get 2-3 consecutive strong bull closes. Even if the bulls get strong closes, the odds favor more sideways trading.
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