- EUR/USD bears have a credible double top forming a negative gap at the 3-month trading range low.
- Bears hope they can get a bear breakout testing the March 7 higher low. If the market does sell off, it will likely form a double bottom higher low at the March 14 low.
- Bear’s problem is that the market is in a trading range, and the double top bear flag the bears have is at the bottom of a channel. This means that there is a greater risk that the bulls will get a bull breakout of the bear flag (March 7–March 17).
- Bears got a bad entry bar following the bear signal bar on March 21. This is a further sign of trading range price action.
- It is important to mention that double tops often have bad follow-through, and still 40% of the time (in general), they lead to a test of the low and try for a measured So as unlikely as it seems, the bears still have a chance at a break below the March low, although it is not likely.
- Overall, traders should expect more sideways over the next couple of days as the market decides on the double top or the bull breakout of the bear flag.
EUR/USD: Breakout Mode
