EUR/USD: Tight Trading Range
Al Brooks | May 21, 2021 09:52AM ET
Micro double top with high from 2 days ago.
EUR/USD is turning down today from nested wedge rally to double top.
If today closes in bottom third of range, then reasonable sell signal bar for Monday.
4-day tight trading range and 8-week tight bull channel, increase chance of more sideways instead of major reversal.
Target is 1.20 area, since Big Round Number, middle of 4-week range, around 50% pullback, and top of Mar. 11 breakout point.
Bulls need consecutive closes above Feb. 25 high for successful breakout. Then, will try for break above Jan. 6 high, which is top of 2-year range.
Strong reversal down 2 hours ago, after small break above yesterday’s high.
Sell climax forming micro double bottom just below yesterday’s low, and bottom of 4-day trading range.
Selloff could simply be test of bottom of that range.
Bears want break below yesterday’s low. Today would then be outside down day.
Bears want today to close below yesterday’s low, which would increase the chance of reversal down.
Bulls want today to close in middle third of range. That would reduce the chance of lower prices on Monday.
Bulls want today to close above midpoint of week, which would increase chance of sideways to up next week.
Since 4-day tight trading range in strong rally, odds are against much lower prices today.
Probably will begin to form trading range, and traders will fight over close of day and close of week.
Unless series of strong trend bars up or down from here, traders will look for reversals.
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.