The EUR/USD bulls are selling out of longs, and the bears are establishing short positions.
Today’s downside breakout is strong enough for a second leg down.
The bears are hopeful that today will close on its low and tomorrow will form a follow-through bar closing on its low.
The bulls are hopeful that today’s selloff is a sell vacuum test of the moving average. However, because the market is in a trading range, the selloff could reach the December 8th low before there is enough buying pressure to drive the market up.
Overall, today’s selloff is strong enough for the odds to favor a second leg down, especially if today closes on its low.
The swing bulls will probably wait to see what kind of follow-through selling the bears are able to create before they are interested in buying.
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