Le Bear Beats Le Boeuf | $EUR $USD #ECB #Fed #forex
Friends,
As you may recall, on May 15th, I highlighted a break out of a pattern within a pattern (some might call it Wolfe, others a wedge, while EW traders might call it a diagonal triangle, but it all works out the same) when price fell below its support trendline (see circled pink highlight in the chart). I inscribed a dashed blue line to highlight the most-probable ensuing price action. Turns out that price did just that for the most part, as it is now readying to seek and define an upper resistance level - See original chart and analyses here:
Typically, that resistance level can be defined by the graphics already in place, namely looking at the possibility that price would rally to the underside of the trendline, which once acted as support and would probably then act as resistance.
Another possibility is the 1.37705 level, which looked under a finer granular timeframe (try, say a H4 level), you might see that at the candle that broke below the support trendline that defined the triangle, the next two candles failed to cross above that defining 1.37705 level.
Besides these two probabilities, I am not foreseeing any other technical obstacles as far as upwards movement defining resistance.
Now, looking at the support ahead, the lines that I drew remain in force and intact. The long-term analysis that I provided back on May 15th remain intact as well. The direction remains bearish, and the outlook still favors bears over bulls.
Data from ECB has left very little room for price action that was not already discounted in the current price action, leading up to a shallow reactive day, hence the long shadow imprinted underneath the candle as of this writing. I would expect more concerning news from Europe, and perhaps more clues from the bond market (i.e.: an increase in yields, reflecting growing uneasiness, which would reflexively push the USD to higher highs and increase the chance towards rate increases in the future).
So, keeping pulse on technicals, fundamentals and predictive/forecasting model, this triad heavily favors bearish appetite for the time being.
Cheers,
David Alcindor
Predictive Analysis & forecasting
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Twitter: @4xForecaster
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As you may recall, on May 15th, I highlighted a break out of a pattern within a pattern (some might call it Wolfe, others a wedge, while EW traders might call it a diagonal triangle, but it all works out the same) when price fell below its support trendline (see circled pink highlight in the chart). I inscribed a dashed blue line to highlight the most-probable ensuing price action. Turns out that price did just that for the most part, as it is now readying to seek and define an upper resistance level - See original chart and analyses here:
Typically, that resistance level can be defined by the graphics already in place, namely looking at the possibility that price would rally to the underside of the trendline, which once acted as support and would probably then act as resistance.
Another possibility is the 1.37705 level, which looked under a finer granular timeframe (try, say a H4 level), you might see that at the candle that broke below the support trendline that defined the triangle, the next two candles failed to cross above that defining 1.37705 level.
Besides these two probabilities, I am not foreseeing any other technical obstacles as far as upwards movement defining resistance.
Now, looking at the support ahead, the lines that I drew remain in force and intact. The long-term analysis that I provided back on May 15th remain intact as well. The direction remains bearish, and the outlook still favors bears over bulls.
Data from ECB has left very little room for price action that was not already discounted in the current price action, leading up to a shallow reactive day, hence the long shadow imprinted underneath the candle as of this writing. I would expect more concerning news from Europe, and perhaps more clues from the bond market (i.e.: an increase in yields, reflecting growing uneasiness, which would reflexively push the USD to higher highs and increase the chance towards rate increases in the future).
So, keeping pulse on technicals, fundamentals and predictive/forecasting model, this triad heavily favors bearish appetite for the time being.
Cheers,
David Alcindor
Predictive Analysis & forecasting
---------------------
Twitter: @4xForecaster
--------------------
