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Weekly Weak EURUSD Pullback

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Market Overview: EURUSD Forex

The market formed a weekly weak EURUSD pullback, the candlestick closing as a bull doji with a long tail below. The bulls expect to get at least a small sideways to up leg to retest the recent leg extreme high (Mar 18), even if it only forms a lower high. If the market trades higher, the bears want it to form a double top with the March 18 High.

EURUSD Forex market

The Weekly EURUSD chart

EURUSD Weekly - Poor FT Selling, Bulls Want 2nd Leg Up, Weekly Weak EURUSD Pullback
  • This week’s candlestick on the weekly EURUSD Forex chart was a bull doji closing in its upper half with a long tail below.
  • Last week, we said the market may trade at least slightly lower. Traders would see if the bears could create a strong follow-through bear bar, or if the market would trade slightly lower but close with a long tail below or with a bull body instead.
  • The market traded lower but reversed to close with a small bull body. The bears were not able to create a follow-through bear bar.
  • Previously, the bulls got a failed breakout below the trading range, forming a strong spike up testing the middle of the trading range and the November 6 high.
  • They hope the bull leg to retest the top of the trading range (Aug/Sep highs) is underway.
  • They see the current move simply as a pullback.
  • They expect to get at least a small sideways to up leg to retest the recent leg extreme high (Mar 18), even if it only forms a lower high. It could happen next week.
  • They want any pullback weak and sideways (overlapping candlesticks, doji(s), bull bars).
  • The bears hope the market will stall around the middle of the trading range and form a lower high.
  • They see the recent move as a buy vacuum and a bull leg within the trading range.
  • They want the middle of the trading range, or the November 6 high to act as resistance.
  • They want a reversal from a micro wedge pattern (Mar 7, Mar 11, and Mar 18).
  • If the market trades higher, they want it to form a double top with the March 18 High.
  • They hope to get a retest of the 20-week EMA or the breakout point (Jan 27).
  • Since this week’s candlestick is a bull doji closing in its upper half, it can be a buy signal for next week.
  • As strong as the recent move was (Mar 18), it could still be a bull leg and a buy vacuum within the trading range.
  • For now, traders will see if the bulls can create a strong follow-through bull bar to retest the March 18 high.
  • Or will the market attempt to trade higher but lack strong follow-through buying, closing with a long tail above or a bear body instead?
  • The market is trading around the middle of the trading range which is an area of balance and a magnet.
  • Traders will BLSH (Buy Low, Sell High) within the trading range until there is a breakout from either direction with sustained follow buying/selling.
  • That means buying in the lower third and selling in the upper third of the trading range.

The Daily EURUSD chart

EURUSD Daily - Bears Want LH MTR, Bulls Want 2nd Leg Up
  • The EURUSD traded sideways to down in the first half of the week. Thursday traded lower but reversed into an outside bull bar. Friday was a follow-through bull bar closing in its upper half.
  • Last week, we said that traders would see if the bears could create more follow-through selling trading below the 20-day EMA, or if the market would trade slightly lower but stall around the 20-day EMA area instead.
  • The market traded lower to test the 20-day EMA but there was no sustained follow-through selling below it.
  • Previously, the bulls got a strong bull leg testing the middle of the trading range.
  • They hope the move to retest the top of the trading range is now underway.
  • They see the current move simply as a pullback. They want the 20-day EMA to act as support.
  • They expect at least a small sideways to up leg to retest the recent leg extreme high (Mar 18). The move could be underway.
  • The bears see the recent move as a buy vacuum and a bull leg within the trading range.
  • They hope the middle of the trading range or the November 6 high will act as resistance.
  • They want a reversal from a wedge pattern (Mar 7, Mar 11, and Mar 18) and a lower high.
  • They see the move on Thursday and Friday simply as a pullback.
  • They want it to form a lower high (to Mar 18) followed by a reversal from a lower high major trend reversal or a small double top.
  • They hope to get a small sideways to down leg to retest the March 27 low.
  • They must create follow-through selling closing below the 20-day EMA to increase the odds of a deeper pullback.
  • So far, the market is trading sideways around the middle of the trading range.
  • As strong as the recent move was (Mar 18), it could still be a bull leg and a buy vacuum within the trading range.
  • The move up is strong enough for traders to expect at least a small sideways to up leg after the current pullback (even if it only forms a lower high). The move could be underway.
  • For now, traders will see if the bulls can create more follow-through buying testing near the March 18 high area.
  • Or will the market trade slightly higher but lack strong follow-through buying, stalling below the March 18 high? If so, we may get another leg down to retest the March 27 low.
  • The market is trading around the middle of the trading range which is an area of balance.
  • Traders will BLSH (Buy Low, Sell High) until there is a breakout from either direction with sustained follow-through buying/selling.
  • That means buying in the lower third and selling in the upper third of the large trading range.

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