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No Weekly EURUSD Breakout

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Market Overview: EURUSD Forex

So far, there is no weekly EURUSD breakout above the triangle pattern. The bulls hope this week was a pullback and want the market to break out above the triangle again. The bears want a reversal from around the top of the triangle pattern and the bear trend line to act as resistance.

EURUSD Forex market

The Weekly EURUSD chart

EURUSD Weekly: 2nd Leg Up, No Breakout Yet, No Weekly EURUSD Breakout
  • This week’s candlestick on the weekly EURUSD Forex chart was a bear doji closing below the middle of its range with a long tail above.
  • Last week, we said that the odds slightly favor the market to trade at least a little higher. Traders will see if the bulls can create a follow-through bull bar breaking above the triangle or if the market will trade slightly higher but stall and close with a long tail or a bear body.
  • The bulls got a small second leg sideways to up to retest the July 17 high and a breakout above the triangle.
  • However, they were not able to get sustained follow-through buying following the breakout.
  • They hope this week was a pullback and want the market to break out above the triangle again.
  • If the market trades lower, they want the 20-week EMA to act as support.
  • The bears see this week as a retest of the July 17 high.
  • They want a reversal from a large wedge bear flag (Mar 8, Jun 4, and Jul 17) and a smaller wedge (Jun 4, Jul 17, and Aug 5).
  • They want a reversal from around the top of the triangle pattern and the bear trend line to act as resistance.
  • They must create a strong entry bar with follow-through selling trading far below the 20-week EMA to show they are back in control.
  • Since this week’s candlestick is a bear doji closing slightly below the middle of its range, it is a neutral signal bar for next week.
  • Traders will see if the bulls can create a retest of the August 5 high with follow-through buying.
  • Or will the market continue to stall around the triangle top followed by the beginning of the bear leg phase?
  • The market is trading around the upper third of the trading range which can be the sell zone of trading range traders.
  • The bear trendline is an area of resistance.
  • The EURUSD is in a 90-week trading range. (Trading range high: July 2023, Trading range low: Oct 2023). 
  • Traders will continue to BLSH (Buy Low, Sell High) within a trading range until a breakout with follow-through selling/buying.
  • Poor follow-through and reversals are hallmarks of a trading range.

The Daily EURUSD chart

EURUSD Daily: No Strong Breakout Yet
  • The EURUSD traded higher on Monday followed by a pullback to the 20-day EMA for the rest of the week.
  • Previously, we said that traders would see if the bears can continue to create follow-through selling trading below the 20-day EMA. Traders expect at least a small second leg sideways to up to retest the leg extreme high (Jul 17) after the pullback.
  • The bulls got a second leg sideways to up to retest the prior leg high (Jul 17) and break above the triangle.
  • However, they couldn’t create follow-through buying following the breakout on Monday.
  • They see the sideways-to-down move this week simply as a pullback.
  • They want at least a small sideways to up leg to retest the August 5 high and a strong breakout above the triangle.
  • If the market trades lower, the bulls want the 20-day EMA to act as support.
  • The bears see a larger wedge bear flag forming (Mar 8, Jun 4, and Jul 17) and another wedge pattern in the current leg up (Jun 4, Jul 17, and Aug 5).
  • They want a reversal from around the upper third of the trading range and the bear trend line area.
  • They want the top of the triangle to continue acting as resistance.
  • They must create follow-through selling trading far below the 20-day EMA to increase the odds of testing the June low.
  • So far, the move up to the August 5 high is strong enough to increase the odds of at least a small sideways to up leg.
  • We may see at least a small retest of the August 5 high (perhaps early next week), even if it only lasts 1 or 2 candlesticks.
  • If the retest of the high is weak and lacks follow-through buying, we may start to see more selling pressure after that.
  • If the bulls can create a strong breakout above the triangle with follow-through buying instead, it will increase the odds of retesting the trading range high (Dec 28).
  • For now, traders will see if the bulls can create a strong retest of the August 5 high.
  • Or will the market stall around the triangle top area followed by more selling pressure?
  • The market is trading near the upper third of the triangle which can be the sell zone of trading range traders.
  • The top of the triangle is an area of resistance.
  • Traders will continue to BLSH (Buy Low, Sell High) within a trading range until a breakout with follow-through selling/buying.
  • Poor follow-through and reversals are hallmarks of a trading range.

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