- The EURUSD is stalling just above the June high.
- The bears have done a great job creating selling pressure over the past six trading days.
- However, it is beginning to form a parabolic wedge following the strong rally up to July 18th. These reasons increase the odds of going sideways over the next few weeks.
- The recent downside breakout is strong enough for a second leg down. Any rally will probably lead to a lower high and fail to surpass the July 18th high.
- The bulls are hopeful that the recent selloff is a buy vacuum test of the Jun2 22nd high that will lead to a higher lower and a test of the July high.
- The bulls will likely need to form a double bottom with the July 25th low at a minimum before they have a chance at a reversal up. This means the first reversal from the six-bar bear microchannel will likely be minor.
- Overall, traders should expect sideways trading for the next several days.
EUR/USD to Test June Highs, Trade Sideways Later
