- The EUR/USD is testing prior higher lows of the bull channel that began on March 24th.
- The bears got a strong breakout with follow-through on May 12th. This was a strong enough surprise that the odds favor a 2nd leg down and lower prices.
- While the market is Always In Short, the market is likely transitioning from a bull channel into a trading range.
- This means that any one of these higher lows could be supported and lead to a failed breakout.
- The bears want to break below the March 15th low and get a measured move down the year-long trading range. More likely, the year is going to continue to go sideways.
- Since the market is Always In Short, traders should expect more sideways to down.
- The bulls must establish more buying pressure before reversing the downside breakout (May 12th).
- Until the bulls collect more buying pressure, the odds favor lower prices and a test of the March 24th low (green line).
EUR/USD Tests Prior Higher Lows
