The market wasn’t prepared to wait for a right shoulder to form on the potential inverted Head & Shoulders I’ve been tracking – it rallied again. Albeit on the back of somewhat dovish Fed statement, EUR/USD appreciated for a third consecutive day – the first such occurrence, since June 25th. The day’s only setup for me came early on, as a Short. It was completely ignored by PA and no entries resulted.
The Fed Statement reaction ensured that we begin the day with PA well above an untested DP and just below the next DCZ (1.2775). My reaction to that scenario is for PA to find Resistance at the DCZ and retrace to test DP. Pivots retain their Mixed formation which poses the “Reversal or Retracement” question. There will be fans of both scenarios today and I’m not convinced which group is correct.
The Day Ahead
The DCZ bounce to DP Test has a certain ring to it and that is Plan A for the day.
High Impact News
|5:00pm||EUR||ECB President Draghi Speaks|
Have a great day.