EUR/USD Breaks Short Term Congestion
As prices bounced between the two trendlines of a very shallow EUR/USD Continuation Channel Down pattern, the 15 minute time frame consolidated.
The Initial Trend reading does not eliminate the chance of a trend, but is not indicating a strong one either. But what made this pattern more interesting was the earlier alert of a Continuation Pennant on the 30 minute chart which has reached the nearby Forecast Region between 1.3840 and 1.3810. The support on the 15 minute Continuation Channel Down was within the Forecast Region, lending more strength to the support of the pattern.
As prices broke up through resistance, the result was a higher move and the 1.3868 level on the 15 minute time frame where the downtrend (green) line was the near term ceiling. This has taken the EUR/USD back to just below the 1.4000 level. This is the price level where the EUR/USD had found resistance last week.
Since the short term charts have moved so dramatically just to get to this level, there is a good chance that there will be exhaustion from the rally. Sellers could also step into shorting the "4000" on the EUR/USD. The Initial Trend of the 240 minute Continuation Falling Wedge is very low, which means that it will probably be better suited to be traded as a congestion/consolidation pattern. So keep an eye on the downtrend (green) line for breakouts since there is very little trending activity on this time frame.
The Initial Trend reading does not eliminate the chance of a trend, but is not indicating a strong one either. But what made this pattern more interesting was the earlier alert of a Continuation Pennant on the 30 minute chart which has reached the nearby Forecast Region between 1.3840 and 1.3810. The support on the 15 minute Continuation Channel Down was within the Forecast Region, lending more strength to the support of the pattern.
As prices broke up through resistance, the result was a higher move and the 1.3868 level on the 15 minute time frame where the downtrend (green) line was the near term ceiling. This has taken the EUR/USD back to just below the 1.4000 level. This is the price level where the EUR/USD had found resistance last week.
Since the short term charts have moved so dramatically just to get to this level, there is a good chance that there will be exhaustion from the rally. Sellers could also step into shorting the "4000" on the EUR/USD. The Initial Trend of the 240 minute Continuation Falling Wedge is very low, which means that it will probably be better suited to be traded as a congestion/consolidation pattern. So keep an eye on the downtrend (green) line for breakouts since there is very little trending activity on this time frame.
- 23 June |
- 0 comments
Post new comment