Brooks Trading Course

Learn to Trade Price Action Consistently

 

More results...

EURUSD Lower High

By

Market Overview: EURUSD Forex

The pullback which started in February formed another EURUSD lower high major trend reversal. The bears want a reversal from the upper third of the large trading range and a breakout below the large triangle pattern. The bulls want the 20-week EMA or the bull trend line to act as support.

EURUSD Forex market

The Weekly EURUSD chart

EURUSD Weekly: Bears Need FT & BO below Triangle, EURUSD Lower High
  • This week’s candlestick on the weekly EURUSD Forex chart was a bear bar closing near its low and below the 20-week EMA.
  • Last week, we said that the odds slightly favor a breakout below the inside bar first. Traders will see if the bears can create a follow-through bear bar closing back below the 20-week EMA. If they do, the odds of a retest of the February low will increase.
  • The bears got what they wanted. Previously, they got a reversal from a wedge bear flag (Nov 3, Nov 29, and Dec 28) and a lower high major trend reversal.
  • They see the recent pullback (to March 8) as forming another lower high major trend reversal (against Dec high).
  • They want a reversal from the upper third of the large trading range and a breakout below the large triangle pattern.
  • Since this week closed below the 20-week EMA, the bears will need to create follow-through selling to increase the odds of the bear leg resuming.
  • If the market trades higher, they want a reversal from a wedge bear flag (with the first two legs being February 22 and March 8) and a double top bear flag with March 8 high.
  • The bulls got a 2-legged sideways to up pullback from a double bottom bull flag (Dec 8 and Feb 14).
  • However, they were not able to get follow-through buying following the recent close above the 20-week EMA.
  • They hope that the current move is simply a pullback and want a retest of the March 8 high followed by a breakout above.
  • They want the 20-week EMA or the bull trend line to act as support. 
  • Since this week’s candlestick was a bear bar closing near its low, it is a sell signal bar for next week.
  • For now, odds slightly favor the market to trade at least a little lower.
  • Traders will see if the bears can create a follow-through bear bar following this week’s close below the 20-week EMA. If they do, the odds of a retest of the February low and breakout attempt will increase.
  • Or will the market trade slightly over, but find support around the bull trend line area?
  • The EURUSD is in a 69-week trading range. (Trading range high: July 2023, Trading range low: Oct 2023). 
  • The EURUSD has been in a smaller trading range in the last 19 weeks. 
  • Traders will continue to BLSH (Buy Low, Sell High) within a trading range until there is a breakout with follow-through selling/buying.

The Daily EURUSD chart

EURUSD Daily: Retest February Low, Can Bears BO below TL?
  • The EURUSD traded slightly lower earlier in the week but reversed back above the 20-day EMA. Thursday reversed below the 20-day EMA with follow-through selling on Friday.
  • Last week, we said that traders want to see if the bears can create follow-through selling below the 20-day EMA. If they can, the odds of the bear leg retesting the February low will increase.
  • The bulls see the move down (to Feb low) as forming a double bottom bull flag (Dec 8 and Feb 14) and a wedge bull flag (Jan 5, Feb 6, and Feb 14). 
  • They got a TBTL (Ten Bars, Two Legs) pullback forming a lower high.
  • They hope to get another leg up from a double bottom bull flag with March 1 low.
  • They want the 20-day EMA or the bull trend line to act as support.
  • If the market trades lower, they want a reversal from a higher low major trend reversal or a wedge bull flag with the first two legs being December 8 and February 14.
  • Previously, the bears were able to able to create sideways to down trading below the 20-day EMA (from Dec to Feb), albeit not very strong (a lot of overlapping price action).
  • They see the recent move (to March 8) simply as a two-legged pullback and a buy vacuum test of the small trading range high area.
  • They got a reversal from a lower high major trend reversal (against Dec high) and a double top bear flag (Jan 11 and Mar 8).
  • They want a retest of the February 14 low (even if it only ends up as a higher low). The retest is currently underway.
  • The bears need to continue creating follow-through selling breaking far below the bull trend line to increase the odds of a retest of the February low.
  • For now, odds slightly favor the market to trade at least a little lower.
  • Traders will see if the bears can create follow-through selling below the bull trend line.
  • If they can, the odds of the bear leg retesting the February low will increase.
  • The EURUSD has been in a small trading range in the last 19 weeks. 
  • The market is trading towards the lower third of the trading range. Poor follow-through and reversals are hallmarks of a trading range.
  • Traders will continue to BLSH (Buy Low, Sell High) within a trading range until there is a breakout with follow-through selling/buying.

Market analysis reports archive

You can access all weekend reports on the Market Analysis page.

>