EUR/USD Sideways Before Comey Hearing
Al Brooks | Jun 07, 2017 09:13AM ET
The 240 minute EUR/USD Forex chart is in a broad bull channel. It is also in a 3 week trading range, and therefore the bears have a reasonable top as well.
The EUR/USD Forex market rallied from a 15 year low this year. Furthermore, the current rally on the weekly chart was a lower low major trend reversal. The rally is now testing the November 9 major lower high. In addition, most major reversals lead to trading ranges and not new trends.
The momentum up is strong enough to make a break above that high likely. Yet, the bears want a lower high. This is because the monthly chart is still in a bear trend, and lower highs are a sign that the strong down trend is strong.
Trading ranges disappoint bulls and bears. The bears will be disappointed by a break above the November high. Yet, the bulls will be disappointed if the rally then fails to break strongly above the 2 year range. Since trading ranges continue indefinitely, the odds are that the Emini will get above the November high, but not far above the 2 year high.
h3 Overnight EUR/USD Forex trading/h3The EUR/USD Forex market sold off 70 pips overnight. But, it has been in a 30 pip range for the past 3 hours. Since it is still in a 3 week trading range, there has been bad follow-through after strong moves up and down. While the selloff might be a start of a move down to the bottom of the range at around 1.1200, most day traders are mostly scalping.
The momentum down last night was strong enough so that the 2 hour rally will probably fail. Consequently, bears will sell the rally. Yet, they will probably take profits near the overnight low. All financial markets will probably be mostly sideways before Thursday’s Comey hearing.
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