EURUSD – Break Lower Looking Increasingly Likely

By Unknown

Rabu, 31 Agustus 2016

EURUSD – Break Lower Looking Increasingly Likely

The recent trading range EURUSD can be almost an escape should clarify whether what we see is just a part of a consolidation continuation of the bearish trend, or temporary dips in the pair before a correction probably late.

pair has been declining for about a year now and in that time, there was almost no corrections, just brief periods of consolidation followed by other moves downward.

price action during the last month was the closest we saw a correction and even that hasn 't been very important. Instead, he traded in a range of 1.0460 to 1.1050. The descending channel intersected the range now and was respected during the rally last week, so we could be about to enter the next phase of this pair.

Looking at the tables at the moment, I have a slight bearish bias for some reasons. First, the slightly lower highs and higher lows through this period suggests this consolidation period formed a flag suggesting a continuation of the downtrend.

The resistance continues as the top of the chain has offered since joining the trading range also supports this, as well as suggesting that the lower break can coming soon. We also continue to negotiate below the SMA 50 days that acted as resistance on numerous occasions over the last 12 months.

If we see a break above the channel and 50-day SMA, it would strongly suggest that we have indeed hit bottom and I would myself bracing for a larger upward correction. Until then, I will adhere to the age-old adage, the trend is your friend.

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