G’day Surfers, welcome to the last day of our trading week. I do hope you were able to claim the pips on offer yesterday.
For nearly two weeks now EUR/USD has been oversold and falling daily. Yesterday promised more of the same, with the 2012 low beckoning the Bears like a Salmon in a waterfall. Rather than put ourselves at the mercy of the rapid flow, we have been waiting in the calm above it to catch our fish which yesterday, gave us a brief chance to pounce – so we did. Playing the break of an intraday trendline, we managed to net our fish just before the pull of the gushing water below, drew him back down. OK translation: we went long at a doji break and banked a 28 pip total, exiting perfectly. In the context of the current market conditions – we have to be very happy with that.
The one change to probably the last six or seven Daily Briefs is that we now have higher lows – critical for us because they allow us to trade. They are telling us that the market (for now) is not interested in returning to the recent lows and may be reversing. Certainly the Bulls might have some “red rags” in sight, to the North. All other technicals remain intact: Two open gaps above the market, 246 pips between Daily & Weekly Pivots with a further 250 to Monthly. These facts telling us EUR/USD is massively oversold. Balancing that somewhat is the dark fundamental shadow casting doubt & fear on a very strong Bearish move.
The Day Ahead
We have an intraday resistance line that has been tested many times in it’s short career. For us to trade it (long only), we need to see a pullback away from it to give price action enough momentum to crash through it OR a mini break then retest from above, enabling it to catapult price action towards the open gap. We still can’t short this market until some gaps close – maybe next week!
Have a great weekend.
Geoff Pyne | Certified SurfingThePips.com Trader
Do YOU want to start making money from Home?
-Learn a STEP-by-STEP Method to Make Money Trading Forex from Home;
-You DON’T Need any Previous Experience;
-Limited Time Offer: $1 Trial;
-Places Subject to Availability.