EUR/USD: Watch For Resistance

EUR/USD Daily Chart.

o    7-day tight trading range with both double top bear flag, and double bottom bull flag, so breakout mode.

o    Bigger double top has measured move target below Nov. 11 low, which was start of bull channel.

o    Most important target for bears is November low, which is start of final leg up of wedge on weekly chart (I will show in weekend post).

o    Today is Friday, so support and resistance on weekly chart can be important at the end of the day. The bulls want the week to close back above the open of the week. The week is a bear inside bar on the weekly chart so far. If it stays this way, it will be a Low 1 sell signal bar.

Overnight EUR/USD Forex trading on 5-minute chart

o    Today, so far, has had follow-through selling after yesterday’s strong reversal down. But today has been in a broad bear channel since late yesterday and the range is small. Day traders have been selling, like yesterday, but they now have also been buying. They are trading reversals for 10- to 20-pip scalps.

o    The last leg down broke below the neckline of a two-day double top bear flag. The bears want a second leg down, and a 30-pip measured move down.

o    Bulls want today to close near the high, so that today will be buy signal bar on the daily chart on Monday for a double bottom with Tuesday’s low.

o    Bears want today to close below Tuesday’s low, which is the neckline of the small double top bear flag on the daily chart.


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