Brooks Trading Course

Learn to Trade Price Action Consistently

 

More results...

Weekly EURUSD Lower High

By

Market Overview: EURUSD Forex

The market traded higher and is currently at a weekly EURUSD lower high. The bulls need to create follow-through buying following this week’s close above the 20-week EMA. The bears hope that the bear trend line will act as resistance. If the market trades higher, the bears want a larger double top bear flag with the March 8 high.

EURUSD Forex market

The Weekly EURUSD chart

EURUSD Weekly: 5-Bar Bull MC but Lower High, Middle of TR, Weekly EURUSD Lower High
  • This week’s candlestick on the weekly EURUSD Forex chart was a bull bar closing in its upper half and trading above the 20-week EMA.
  • Last week, we said that while the recent 4 consecutive bull bars were not very strong, the odds are slowly moving in favor of a failed breakout of the triangle pattern and the smaller 22-week trading range.
  • The bears got a breakout below the triangle pattern and the smaller 22-week trading range but were not able to get follow-through selling.
  • They see the recent moves simply as a deep pullback and want at least a small retest of the April 16 low (even if it forms a higher low).
  • They want a reversal from a double top bear flag (Apr 9 and May 16) and a lower high.
  • They hope to get at least another leg down completing the wedge pattern with the first two legs being February 14 and April 16. 
  • The bears hope that the bear trend line will act as resistance. If the market trades higher, the bears want a larger double top bear flag with the March 8 high.
  • The bulls see the prior move down (to April 16) simply as a two-legged pullback (which started on Dec 28) and a bear leg within a trading range.
  • They got a reversal from around the lower third of the large trading range from a higher low major trend reversal, a larger wedge bull flag (Mar 15, Oct 3, and Apr 16) and a wedge in the third leg down (Dec 8, Feb 14, and Apr 16).
  • They have a 5-bar bull microchannel in the current leg up. That means persistent buying. 
  • They need to create follow-through buying following this week’s close above the 20-week EMA.
  • Since this week’s candlestick is a bull bar closing in its upper half, it is a buy signal bar for next week.
  • Traders will see if the bulls can create a follow-through bull bar closing above the 20-week EMA, even if it is just a bull doji.
  • Or will they fail to do so, like the third week of March (inside bear bar)?
  • The market is currently trading around the middle of the trading range. It is an area of balance.
  • The EURUSD is in a 78-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 there is a breakout with follow-through selling/buying.
  • Poor follow-through and reversals are hallmarks of a trading range.

The Daily EURUSD chart

EURUSD Daily: Wedge Bear Flag, DT Bear Flag, Middle of TR
  • The EURUSD traded sideways to up for the week above the 20-day EMA.
  • Last week, we said that traders would see if the bears could create another leg down after the current pullback (bounce).
  • The market continued higher with stronger bull bars and a weak pullback on Friday.
  • The bulls got a reversal from around the lower third of the large trading range, a higher low major trend reversal and a wedge bull flag (Dec 8, Feb 14, and Apr 16).
  • They needed to do more by creating strong consecutive bull bars closing near their highs and trading far above the 20-day EMA to increase the odds of retesting the December high.
  • They have done that this week. The next target for the bulls is the March 8 high.
  • If the market trades lower, they want a higher low major trend reversal and the 20-day EMA to act as support.
  • The bears got a breakout below the smaller trading range and the triangle pattern but had limited follow-through selling.
  • They see the current move as a deep pullback forming a wedge bear flag (Apr 26, May 3, and May 16) and a double top bear flag (Apr 9 and May 16).
  • They want another leg down completing the larger wedge pattern with the first two legs being February 14 and April 16.
  • They want at least a small retest of the April 16 low, even if it only forms a higher low.
  • If the market trades higher, the bears want a reversal from a larger double top bear flag with the March 8 high.
  • For now, the move up is in a tight bull channel with stronger buying pressure (bull bars with follow-through buying) against weaker selling pressure (smaller bear bars with limited follow-through selling).
  • Odds slightly favor at least a small second leg sideways to up after a pullback.
  • The market is currently trading around the middle of the trading range which can be an area of balance.
  • Traders will continue to BLSH (Buy Low, Sell High) within a trading range until there is a breakout with follow-through selling/buying.
  • Poor follow-through and reversals are hallmarks of a trading range.

Market analysis reports archive

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

>