Potential Trend Reversal Developing on EUR/USD Hourly
EUR/USD completed a wave 7 last night, but then went on to move below the wave 6 swing low today. Because the 50MA is still angling upward, the trend remains up.
However, there are several signs of a reversal developing. First off, we are now beyond wave 5, where trends are more likely to end. Moreover, the wave 7 high did not touch the upper Bollinger band. That suggests a weakening of the uptrend. Also, there has been a significant deterioration in momentum, as signaled by a declining MACD line.
A rally around here will offer a reasonable opportunity to short, though one must be careful inasmuch as the trend remains up.
However, there are several signs of a reversal developing. First off, we are now beyond wave 5, where trends are more likely to end. Moreover, the wave 7 high did not touch the upper Bollinger band. That suggests a weakening of the uptrend. Also, there has been a significant deterioration in momentum, as signaled by a declining MACD line.
A rally around here will offer a reasonable opportunity to short, though one must be careful inasmuch as the trend remains up.
