View: $EURUSD analysis towards important events - The Market Zone
$EURUSD analysis towards important events - The Market Zone
The $EURUSD bullish pattern, mentioned in the Weekly Markets Analysis newsletter during the last month, reached its target level at 1.37.
As it reached 1.37, I opened a short position based on daily resistance, Fib level and my longer term analysis which suggests that $EURUSD is headed towards 1.34. The position is already up by 45 pips.
Just as a reminder - the $EURUSD is dealing with a monthly/weekly downtrend line after a false break! As long as it stays below this trend line, all long positions are for the short term.
Zooming into the weekly chart, you can see that the $EURUSD latest downward move (after a double top and a weekly bearish engulfing pattern which posted here) has only reached the 38.2 Fib level. The technical expectation is that this pair will reach at least 50% or 61.8% retracement in the weekly chart. That means much lower targets for the Euro.
Even tough I expect this pair to reach lower weekly target levels, It doesn’t necessarily means that it will be from the 1.37 level.
For those among you who think that the $EURUSD has more power in it for another run higher, I see two interesting levels that it may reach. (which will present short opportunities for those who seek to sell from higher price level):
1. 1.38 which will be the bullish Bat’s (first picture above) second target level and a daily resistance level.
2. 1.372 - Daily Butterfly pattern PRZ
As you can see in the last chart, if you are bullish $EURUSD, you are in a buying zone - Trend line and support zone. Buy here (with wide stop) with anticipation that the price will reach either to the Butterfly’s PRZ or to 1.38. (in both, it has to overcome 1.37 resistance).
A break below current support will confirm that this pair intends to go lower and that my current short position (already reduced by half after profit taking) can be a very profitable trade.
Don’t forget to stay tuned to Yellen’s and Draghi’s show
Trade smart, Trade the Zone
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