Well, what can we say. EUR/USD put in an exceptionally bullish week. We were expecting a bullish push from the pair, but perhaps not as significant as the one observed. With price firstly smashing through the previous high from 1st Sept and then onwards through the resistance at 1.2143, the pair is now back up to levels not seen since Apr 2018. Price now sits convincingly clear of any descending daily, weekly and even monthly resistance trends, which is encouraging for bulls, as a significant trend change can now be envisaged. Zooming out to the monthly timeframe, price has arguably posted a double bottom formation, offering further encouragement. The next significant zone of resistance now sits at 1.2410.
As we know, the market moves in waves, therefore do not expect the bullish momentum to continue forever. Although we don’t use the RSI in our strategy the 4H & daily timeframes are sitting in overbought territory. Although the longer-term trend is now more convincingly bullish, do not be surprised by bearish pullbacks so bulls can ‘refuel’. Price is now well clear of the last ascending 4H & daily structure, therefore a pullback to these would seem feasible, and could be good long entry opportunities.
As we know, the market moves in waves, therefore do not expect the bullish momentum to continue forever. Although we don’t use the RSI in our strategy the 4H & daily timeframes are sitting in overbought territory. Although the longer-term trend is now more convincingly bullish, do not be surprised by bearish pullbacks so bulls can ‘refuel’. Price is now well clear of the last ascending 4H & daily structure, therefore a pullback to these would seem feasible, and could be good long entry opportunities.