Well at the end of each month I tend to look at monthly closes to gauge perspective on where a currency pair may head in the upcoming month. I previously posted analysis showing the huge absorbtion/accumulation of short sellers and buyers alike. What the monthly chart shows is that sellers have gotten weaker, and weaker, and weaker as each month passes. Evident by the upper wicks, sellers pounce in force only to be stopped in their tracks at the 1.04 Support, followed by strong buying pressure which plows through sellers evident by the bodies and lack wicks in the previous months candle. So all in all, I expect the Euro/Dollar to break above 1.14 Resistance handle.
Can we see some short term pullback before a break? Of course we can, anything is possible. This business is about probabilities and the probability of success. Price action to me personally says probability is to the upside.
All the best, happy trading.
Note: Disregard the horizontal support/resistance lines above 1.22 (They are merely areas I intend to enter shorts for a multi-month short trade.
Comentarios
moneymaking
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Hey mate, great analysis. Totally agree with you on breaking that key resistance level. Waiting for a good pullback to enter long, hopefully market gives us one. All the best and have a wonderful trading week :)
Daniel.B
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Thanks man, looks like the market is giving us the beginning of a pullback based off of the daily candles which have formed. Also check out the new lows on the dollar (its accumulating and looks like it'll retrace back up to resistance). I'm trading the pull back on the Euro with a short term short selling trade.
moneymaking
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Great, I also got a short trade open on the EUR. Seeing good consolidation in the dollar, let's see if we get a pullback in dollar before breaking that strong support level. The key thing to note with the dollar is that, it is at key monthly support level as well, which is why we might be seeing the ranging market in the dollar. Let's wait and see what happens. All the best mate :)