- The EUR/USD formed a tight trading range over the past 8 bars. Until there is a clear breakout of the tight trading range, traders should assume that the tight trading range price action will continue indefinitely.
- The bulls are trying to defend the July 6th buy signal bar high. The bears have been unable to reach the July 6th buy signal bar high during the August selloff. This is a sign of strength for the bulls.
- The market may have to reach the July 6th high before having a rally lasting a couple of lets.
- While the selloff from the July high is not enough to transition the market into a trading range, but not a bear trend. This means traders should expect a rally soon, lasting a few weeks. It will probably get near a 50% pullback of the August selloff.
- Assuming the bulls get a weak rally, the bears will try a major trend reversal and a second leg down from the August selloff.
- Overall, traders should expect the bears to continue to get disappointed after the selloff on the August 3rd low and a weak rally lasting a couple of weeks.
EUR/USD Likely to Trade Sideways in a Tight Range
