Market Overview: EURUSD Forex
The weekly chart was a EURUSD consecutive bull bar, testing the trading range high. The bulls need to create follow-through buying above the November 29 high to increase the odds of retesting the July high. The bears want a reversal from a small double top (Nov 29 and Dec 22) and a lower high major trend reversal.
EURUSD Forex market
The Weekly EURUSD chart
- This week’s candlestick on the weekly EURUSD Forex chart was a bull bar closing near its high.
- Last week, we said that odds continue to slightly favor any pullback to be minor and for the market to still be Always In Long.
- This week traded higher and closed slightly below the November 29 high.
- The bulls want a retest of the July high followed by a continuation higher in the form of a large second leg up (with the first leg being September 2022 to July 2023 rally).
- They got a reversal from a higher low major trend reversal with the 20-week EMA acting as support.
- They need to continue creating follow-through buying trading above the November 29 high to increase the odds of higher prices.
- The bears got a pullback to the 20-week EMA but were not able to create follow-through selling.
- They see the rally in October and November simply as a deep pullback.
- They want a reversal from a wedge bear flag (Oct 12, Nov 3, and Nov 29) and a lower high major trend reversal.
- They hope that this week was simply a retest of the prior leg’s extreme high (Nov 29) and want a reversal from a small double top (Nov 29 and Dec 22).
- They need to create a few strong consecutive bear bars closing below the 20-week EMA to increase the odds of retesting the trading range low.
- Since this week’s candlestick is a bull bar closing near its high, it is a buy signal bar for next week.
- For now, odds continue to slightly favor the market to still be Always In Long.
- Traders will see if the bulls can create another follow-through bull bar or will the market stall around the November 29 high area.
The Daily EURUSD chart
- The EURUSD traded higher for the week, breaking above the big inside bear bar.
- Last week, we said that the odds slightly favor a breakout below the inside bar first. While the pullback can last a couple of weeks more, odds slightly favor the market to still be Always In Long.
- Previously, the bulls got a bull leg which retested the upper third of the trading range (in November).
- They then got a reversal from a higher low major trend reversal (Dec 8) and a second leg sideways to up after a 50% pullback.
- They hope to get a big second leg sideways to up lasting many weeks.
- The bulls will need to create sustained follow-through buying above the November 29 high to increase the odds of higher prices.
- Previously, the bears got a reversal down from a wedge pattern near the upper third of the trading range (Nov 14, Nov 21, and Nov 29), a lower high major trend reversal and a double top bear flag (Aug 10 and Nov 29).
- However, they were not able to get a second leg sideways to down.
- They see the current move as a two-legged retest of the November 29 high and want a reversal from a double top major trend reversal (Nov 29 and Dec 22).
- They will need to create consecutive bear bars closing near their lows and trading below the 20-day EMA next week to increase the odds of a deeper pullback.
- Friday broke above the November 29 high, but it was not a strong breakout bar.
- The bulls need to create sustained follow-through buying above the November 29 high to increase the odds of retesting the July high.
- If the market continues to stall around the November 29 high area, the odds of another pullback will begin within a few weeks.
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