EUR/USD: Bears Looking For Breakout Below Bull Flag
EUR/USD: Bears Looking For Breakout Below Bull Flag
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EUR/USD Daily Chart
EUR/USD bear are trying to get three consecutive bear bars and a bear breakout below a bull flag.
Bears hope that they can reach the May 23 low and 50% pullback of the May 30 rally. The bears will ultimately try and test the May 13 low. Also, the bears are trying to close the May 6 breakout point gap.
Bulls will see any selloff as a higher low major trend reversal that will lead to a second leg up from the May 31 rally and test the April 21 high.
Right now, the odds favor a higher low and the bears failing to fall below the May 13 high.
The market is in a trading range, so the selloff could be deeper than what traders want.
Bears will try hard to get a big bear breakout with follow through or 3-5 consecutive bear bars, which would increase the odds of lower prices. The bulls know this and will try to prevent strong consecutive bear bars.
Right now, it looks like the odds favor a pullback and test of the May 23 low (red box) and a test of the 50% pullback level (blue line) before the market can go much higher.
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