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No EURUSD Follow-through Buying

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Market Overview: EURUSD Forex

There was no EURUSD follow-through buying on the weekly chart. Is this simply a pullback to be followed by another leg up completing the wedge pattern (with the first two legs being February 22 and March 8), or is the market forming a lower high major trend reversal? Traders will see if the bears can create a strong follow-through bear bar closing below the 20-week EMA.

EURUSD Forex market

The Weekly EURUSD chart

EURUSD Weekly: No Follow-through Buying, PB or LH MTR?, No EURUSD Follow-through Buying
  • This week’s candlestick on the weekly EURUSD Forex chart was an inside bear bar closing near its low.
  • Last week, we said that traders will see if the bulls can create follow-through buying or will the bears be able to create a reversal back below the 20-week EMA instead.
  • The bulls were not able to get a follow-through bull bar following last week’s close above the 20-week EMA.
  • They want a retest of the December high followed by a breakout above.
  • They got a reversal from a double bottom bull flag (Dec 8 and Feb 14) and see the recent pullback (from Dec to Feb) as minor.
  • The move-up consists of a 5-bar bull microchannel which means consistent buying. There may be buyers below the first pullback.
  • If the market trades lower, they want the 20-week EMA or the bull trend line to act as support. 
  • They hope to get at least another leg up completing the wedge with the first two legs being February 22 and March 8.
  • The bears 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 current pullback (bounce) as forming another lower high major trend reversal (against Dec high).
  • They want the market to reverse back below the 20-week EMA and a breakout below the large triangle pattern.
  • 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 large double top bear flag with the December high.
  • Since this week is an inside bear bar closing near its low, the market is in breakout mode. It is a sell signal bar for next week.
  • Odds slightly favor a breakout below the inside bar first. The first breakout can fail 50% of the time.
  • There may be buyers below the first pullback from a tight 5-bar bull microchannel.
  • 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.
  • Or will the market remain in the tight bull channel and form another leg higher? 
  • The market is trading around the middle of the trading range. Poor follow-through and reversals are hallmarks of a trading range.
  • The EURUSD is in a 68-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 18 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: PB then Wedge, or LH MTR?
  • The EURUSD formed a small pullback earlier in the week, followed by a retest of the prior high (Mar 8). The market spiked down on Thursday but stalled at the 20-day EMA Friday.
  • Last week, we said that the pullback is strong enough to slightly favor at least a small sideways to up leg after a small pullback. Traders will see if the bulls can create more buying pressure, or will more selling pressure start to develop around the trading range high area instead?
  • 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 want at least a TBTL (Ten Bars, Two Legs) pullback. The recent pullback has fulfilled the minimum requirement.
  • They hope to get another leg up, completing the wedge pattern with the first two legs being February 22 and March 8.
  • 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 simply as a two-legged pullback and a buy vacuum test of the small trading range high area.
  • They want a reversal from a lower high major trend reversal (against Dec high) and a double top bear flag (Jan 11 and Mar 8).
  • At a minimum, they want a small retest of the February 14 low (even if it only ends up as a higher low).
  • If the market trades higher, they want it to stall around the March 8 high area.
  • For now, 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 EURUSD has been in a small trading range in the last 18 weeks. 
  • The market is trading around the middle 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.

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