- The EUR/USD rallied early this morning and sold off more recently.
- The bears have a six-bar bear microchannel on the daily chart. This increased the odds of sellers above and a second leg down.
- The bears are still trying to close the June 22nd breakout point high. This is an open gap, and since the daily chart is likely in a trading range, the odds are it will close.
- The July 12th low is also a magnet because it is a possible exhaustive buy climax. When the market is in a trading range, it is common for the market to fall below strong breakout bars and reverse up after. This means the market might fall below the July 12th low and reverse up shortly after.
- The bulls want today’s early morning rally to lead to a double bottom over the next few days and for the market to reverse.
- Overall, the odds are that the bears will get a second leg down on the daily chart after the 6-bar bear microchannel.
EUR/USD: Sellers Lurk Above, Second Leg Down Likely
