- The EUR/USD pair is becoming Always In Short and breakout below the moving average. I have mentioned several times that the odds were that the bull channel that began on March 24th would likely convert into a trading range.
- This means that prior lower highs (see chart) are targets for the bears.
- If today closes on its low, the market will probably be Always In Short, and the odds will favor a second leg down.
- Since the market is in a likely trading range, traders will pay close attention to today’s bar. If today closes above the midpoint, it will increase the odds of the Bears getting a deeper pullback before they get a second leg down.
- The bulls will see any selloff as a sell vacuum test of support. The bulls will want the market to form a double bottom with one of the higher lows, such as April 10th, and for the market to rally to a new high. This is unlikely with the market developing more buying pressure first.
EUR/USD: Bears Get Downside Breakout
