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EURUSD Big Bear Breakout below Sept Low

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Market Overview: EURUSD Forex

The EURUSD Forex broke out with a big bear breakout bar below the September low. The bears want a persistent trend down towards the year 2000 low. If the bears start getting consecutive bear bars closing near the low, the odds of this increase. The bulls will need to create strong consecutive bull bars closing near their highs to create a failed breakout soon. 

EURUSD Forex market

The Weekly EURUSD chart

EURUSD Forex Weekly Chart Big Bear Breakout Bar
  • This week’s candlestick on the weekly EURUSD Forex chart was a big bear breakout bar closing near the low.
  • Last week, we said that traders will be monitoring if the bears get a follow-through bear bar or fail to do so. If they get that, the odds of a retest of Sept 6 low and a breakout attempt increases.
  • The bears got a strong follow-through big bear breakout bar that broke far below Sept low.
  • The bears want a strong breakout below the 2017 low, and a measured move down based on the height of the 7-year trading range. This will take them to the year 2000 low.
  • The move down is in a tight bear channel. That means strong bears. 
  • The bears got the second leg sideways to down in August after the recent pullback. 
  • They have now got a strong big bear breakout below the September low.
  • The bulls hope that the recent 4-week tight trading range pullback is the final flag of the move down which started in February 2022. They want a failed breakout below the 7-year trading range. 
  • They want a reversal higher from a wedge bottom (May 13, July 14 and Sept 23).
  • However, the bulls failed to get follow-through buying, a recurring theme since the selloff started in 2021.
  • Since this week was a big bear bar closing near the low, odds slightly favor sideways to down for next week.
  • Traders will be monitoring if the bears get a follow-through bear bar next week or fail to do so. 
  • A strong breakout such as this can sometimes lead to a persistent trend that goes a long way.

The Daily EURUSD chart

EURUSD Forex Daily Chart Strong Bear Breakout below Sept Low
  • The EURUSD traded slightly higher earlier in the week but failed at the 20-day exponential moving average and traded down for the rest of the week.
  • Last week, we said that odds slightly favor the EURUSD to still be in the sideways to up pullback phase.
  • The bulls want a failed breakout below the 7-year trading range.
  • They hope that the recent 4-week tight trading range pullback is the final flag of the move down which started in February. 
  • The bulls want a reversal higher from a wedge bottom (Mar 4, May 13 and July 14) and a double bottom with the July low (July 14 and August 23).
  • The bulls also have a smaller wedge (July 14, Aug 23 and Sept 6).
  • However, they have not been able to create sustained follow-through buying and this week broke far below the September low.
  • The bulls will need to create strong consecutive bull bars closing near their highs to create a failed breakout soon.
  • The bears want a continuation down and a measured move down based on the height of the 7-year trading range. That would take them to the year 2000 low.
  • The bears want another leg lower following last Tuesday’s strong leg down re-testing Sept low. They got that this week, and a breakout below Sept low.
  • A strong breakout such as this sometimes can lead to a persistent new trend. 
  • Traders will be monitoring if the bears get sustained follow-through selling next week.
  • For now, odds slightly favor sideways to down.

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