Market Overview: EURUSD Forex
The EURUSD bulls need follow-through bull bars on the weekly chart to increase the odds of a retest of the range high. Bears want the market to reverse below the 20-week EMA.
EURUSD Forex market
The Weekly EURUSD chart
- This week’s candlestick is a bull bar closing near its high, breaking above the 20-week EMA.
- Last week, we said traders would watch whether bears could retest and break below the March 13 low, or if the market would continue to stall near the range low, increasing the odds of a bull leg to retest the trading range high.
- Bulls see the March 13 move as a sell vacuum test of the trading range low.
- They want the August low and trading range low area to hold as support.
- Bulls see a two-bar reversal (March 3 and March 13) and a large double bottom bull flag (August 1 and March 13).
- Bulls triggered the High 2 buy setup this week, creating a strong entry bar.
- Bulls need follow-through buying above the 20-week EMA to increase the odds of a retest of the range high.
- If the market trades lower, bulls want a higher low relative to the March 30 low.
- Bulls see the 44-week trading range as a large bull flag and want a resumption of the bull trend.
- Previously, bears formed a 6-bar bear microchannel testing the bottom of the trading range, followed by a weak second leg sideways to down, forming a higher low (March 30).
- Bears want the middle or the upper third of the trading range to act as resistance.
- They hope the current move will lack follow-through buying, forming bear bars and overlapping bars with prominent upper tails.
- Bears want the market to reverse below the 20-week EMA.
- Bears need consecutive bear bars closing near their lows to show control.
- The market stalled around the lower third of the trading range and reversed higher this week.
- Price remains within the 44-week range. Until there is a clear breakout with strong follow-through, traders may continue Buy Low, Sell High (BLSH), buying near the lower third and selling near the upper third.
- The middle of the range can act as a magnet and area of balance, currently around the 20-week EMA.
- Traders will watch whether bulls can create a follow-through bull bar above the 20-week EMA. A strong bar would increase the odds of a retest of the trading range high.
- Or will the market reverse back below the 20-week EMA and retest the trading range low instead?
The Daily EURUSD chart
- EURUSD traded higher this week, forming a 5-bar bull microchannel.
- Previously, we said traders would watch the strength of the retest of the March 13 low — whether it would be strong or weak, forming a higher low or a double bottom.
- Bears created a strong bear leg testing the trading range low (March 13), followed by a small second leg sideways to down (March 30), forming a higher low.
- The move stalled around the trading range low, and bears failed to create a strong breakout below.
- Bears see the current move as a two-legged pullback forming a double top bear flag (March 23 and April 10).
- Bears want the February 23 high to act as resistance, forming a larger double top bear flag (February 23 and April 10) and a lower high major trend reversal.
- Bears want a larger second leg sideways to down to retest the March 13 low.
- They need consecutive strong bear bars to show control.
- Bulls got a reversal from a higher low major trend reversal (March 30) and a double bottom pullback (March 19 and March 30).
- Bulls want a retest of the trading range high, followed by a breakout and resumption of the bull trend from a large double bottom bull flag (August 1 and March 13).
- If the market pulls back, bulls want a higher low relative to the March 30 low.
- They need consecutive strong bull bars closing near their highs to increase the odds of a retest of the trading range high.
- The market stalled around the bottom of the trading range, followed by a strong spike above the 20-day EMA in the form of a 5-bar bull microchannel, indicating strong buying.
- Traders are watching if bulls can create more follow-through buying to retest the top of the trading range.
- Or if the market forms a pullback and retests the trading range low instead. If this is the case, traders will watch the strength of the pullback — whether it is strong (consecutive strong bear bars) or weak (overlapping bars, prominent lower tails) — and whether it forms a higher low relative to the March 30 low.
- EURUSD remains in a trading range. Until there is a strong breakout with sustained follow-through, traders may continue Buy Low, Sell High (BLSH), buying near the lower third and selling near the upper third of the range.
Market analysis reports archive
You can access all weekend reports on the Market Analysis page.
