- The EUR/USD bears recently broke below a bear channel yesterday. However, the breakout bar reversed up, forming a bull reversal bar.
- Yesterday’s bull reversal bar is within a tight bear channel, which lowers the probability of buying above it. However, it is reasonable for the bears to exit above yesterday’s bar, betting on a test of the moving average (blue line).
- If the bulls want a higher probability, they must wait for strong follow-through buying in consecutive strong bull trend bars.
- The market found buyers below the July 6th low, which was expected. The bulls are making money with limit orders below bars, which indicates that the market is in a trading range.
- Next, traders will want to see bulls make money with stop entries, increasing the odds that the market is in a trading range.
EUR/USD's Breakout Below July 6 Signal Bar Fails: What Lies Ahead?
