- The EUR/USD sold off after testing the February 2nd low. February 2nd was a stop entry sell, and bulls got trapped buying the bear’s low. This meant that both bulls and bears would likely be selling and retest of the February 2nd low.
- Today is the entry bar for yesterday’s stop entry short. The size of today is a little bit of a surprise, which will increase the odds of a small 2nd leg down. However, the problem the bears have is that the bulls have a 6-bar bull micro channel. This will probably limit the downside.
- Overall, traders will pay close attention to today to see if it will close on or near its low. If it does close on its low, that will increase the odds of sellers above for a small 2nd leg down. If today has a big tail, that will lower the probability of the bears getting a 2nd leg down.
EUR/USD: Profit-Taking Ensues at Feb. 2 Lows
