- The EUR/USD reversed up from the April 10th failed bear breakout and is now at the February 1st close. I have been saying the market would probably reach the February 1st close and allow the scale-in bulls to get out.
- It was reasonable to buy the February 1st close if a trader was willing to use a wide stop and scale in lower.
- Traders will pay attention to what happens at the February 1st close. If the market breaks far above it, that will be a sign that more traders were buying at the retest of the February 1st close, increasing the probability of higher prices. If the market reverses down from the February 1st close, it will increase the probability that the market is in a trading range.
- Most traders should wait for a clear upside breakout with follow-through above the February range before buying.
- The bears need a decent sell signal bar around the February 1st close. This would be a sign of a failed breakout of the February high and increase the probability of a pullback to the middle of the two-month trading range.
- Overall, traders will pay close attention to today’s bar to see if it closes on its high or gets a deep pullback.
EUR/USD Market at February 1 Close
