It has been nearly a month since my last analysis about the EUR/USD. Back then I saw the final wave (blue) 5 in full swing, having a pyramid of three short positions open as the resistance of 1.10 was a reliable stronghold.
However, the only serious support that could have spoilt the party, before heading directly to 1.02/1.00, was the support at 1.05 which, indeed, didn't give in.
Detour And Retour
If you followed me on my social media channels back then, you were suggested to keep stops on short positions tight as the direct shift towards the (blue) 5 at 1.02/1.00 might be in danger if 1.05 holds - I was even more precise: I indicated a correction to a max. of 1.18 if the support doesn't break.
However, looking at the big picture now makes me revise my initial analysis a little bit.
Everything Above 1.14 Is Crucial
With a climb towards 1.14 the EUR/USD bulls set foot into hostile terrain. A strong resistance level is more than obvious in the chart and I expect the correction to come to an end at around that price area. The slightest 'unforeseen' move could activate a chain reaction of profit taking - which will finally result into a series of stop loss triggering.
Keep Your Feet Dry
The above mentioned scenario is, based on the current circumstances and indicators the most likely. However, to not run into unnecessary hassle it is best to wait for the scenario to be confirmed before jumping on the gravy train.
Bottom Line
I keep a close eye on the pair and will open a short position with target 1.02/1.00 as soon as I get a confirmation in all my accounts.
Comments welcome.
Cheers
However, the only serious support that could have spoilt the party, before heading directly to 1.02/1.00, was the support at 1.05 which, indeed, didn't give in.
Detour And Retour
If you followed me on my social media channels back then, you were suggested to keep stops on short positions tight as the direct shift towards the (blue) 5 at 1.02/1.00 might be in danger if 1.05 holds - I was even more precise: I indicated a correction to a max. of 1.18 if the support doesn't break.
However, looking at the big picture now makes me revise my initial analysis a little bit.
Everything Above 1.14 Is Crucial
With a climb towards 1.14 the EUR/USD bulls set foot into hostile terrain. A strong resistance level is more than obvious in the chart and I expect the correction to come to an end at around that price area. The slightest 'unforeseen' move could activate a chain reaction of profit taking - which will finally result into a series of stop loss triggering.
Keep Your Feet Dry
The above mentioned scenario is, based on the current circumstances and indicators the most likely. However, to not run into unnecessary hassle it is best to wait for the scenario to be confirmed before jumping on the gravy train.
Bottom Line
I keep a close eye on the pair and will open a short position with target 1.02/1.00 as soon as I get a confirmation in all my accounts.
Comments welcome.
Cheers
