EUR/USD: Traders Continue To Look For Reversals
Al Brooks | Jun 07, 2021 10:30AM ET
EUR/USD:
– Friday is High 2 buy signal bar, and a wedge bull flag buy signal bar.
– But it had a prominent tail on top, it followed a big bear bar, and it is in the middle of a two-month trading range. This lowers the probability of a strong move up today.
– Today so far is a small inside doji bar, and there is, therefore, no evidence of a big move up or down.
– Two-month trading range is breakout mode.
– Bulls want a breakout above, and a 200-pip measured move up to above the February 2017 high, which is the top of a seven-year trading range.
– Bears want break below May 5 low at the bottom of the range, and a measured move down to around the March 31 low.
– Slightly more bullish than bearish, but still close to 50% chance of bear breakout.
– Traders continue to look for reversals every few days.
h2 Overnight EUR/USD Trading On 5-Minute Chart/h2– Today so far has a small range, and there have been several reversals. Day traders have been scalping up and down.
– Even though Friday is a buy signal bar, today has not gone above Friday’s high.
– Unless there is a series of strong trend bars in either direction, day traders will continue to scalp today.
– Because Friday is a weak buy setup, there might be more sellers than buyers above Friday’s high.
– Unless there is a strong breakout above Friday’s high, day traders will look to sell a reversal down from above Friday’s high.
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