EUR/USD: Stable Above 1.1200
I am aware the ultimate low was 1.1115 but EURUSD has shown great resilience from the 1.12 region, multiple rejections on all timeframes off of this level. My only question is that we haven’t run away from the 1.12 handle, there’s no price action screaming at me telling me to buy this currency pair, we are lacking on key element, MOMENTUM!
In my recent articles I have highlighted the fact that both
EURUSD and DXY have been range-bound for some time after coming from the downtrend in EURUSD and uptrend in DXY. The problem with this is if the trend is going to reverse and make a substantial recovery it has a lot of overhead resistance it needs to get through, and as traders we are looking for the path of least resistance.
Technically speaking a break of 1.1125 and a daily closure below this would spark a quick sell-off lower with the next resistance being at 1.10 phycological round number. When I look at the blank chart I see a lot of conflicting signals, I see a double bottom with the neckline at 1.12, taking a look at the most recent price action I see a head and shoulders pattern with the neckline again at 1.12, two conflicting biases. When I see conflicting biases I stay at, I ask myself where is my edge when taking a position? The old saying still applies today “When in doubt stay out”!! Follow this principle and you won’t do too badly.