Can this Inverted H&S on EURUSD break to the topside?

Dear friends,

Please do your analysis before placing an order on EU.
We can see an inverted H&S on EURUSD today on 4hrs TF. I would wait for the break of the neckline first and then a visit to the neckline followed by a nice bullish candle and then I would go long.

To me EURO is a big bear when looking at the weighted average chart. I think you think the same. Just follow the basic rules for Wedge formation. Complete rotation.

This is very easy to spot.
But see where EURO is now. Sitting at the EMAs and very close to fibos

A visit to the EMAs and overhead Fibos expected

But the question is whether EURO gonna get to 38.2% first before pulling bouncing. Looking at this chart we cannot answer the question and we should look for other charts
Remember the EURO has not touched the EURO major FIBO yet.
Long term EURO is a big bear but we would like to know whether we see a bounce here or not before heading further lower.
EURO futures is the next market that I would like to review here
See the extensive move that we started 20 days ago. No sign of retracement what so ever.

At least a retracement to here is expected

Like other indices we have EUSTX50 with opposite correlation with EURO. This one is also just touched the highs and last week just moved lowers which means we should have seen EURO retracement which we have not seen it yet.

But EURO Yields and EURO Bonds are not the same as other currencies and we have several countries in EURO region.

We only look at the major ones. Germany France and Italy.
But before moving to other markets, I would like to show you the correlation between weighted average indices and EURO currency

Not the best negative correlation in the world but as you can see when indices going lower the EURO should go higher and vice versa.

See the German Yields here. A massive break last a few days and it is now retracing

Same with France Yields

Ok but the crazy moves last week caused by Italy. Let’s look at it now.

See the big drop in Italian Index.

Comment:

It seems that we have a break of the Neckline NOW!
But remember we should see at least hourly candle to close above the neckline first.
I will update you,
Khan

Comment:

EU hourly is closing above the Neckline. It is a good bullish sign...

Comment:

I am looking at this channel guys. We would like to see a bounce off the mid-band to confirm the bullish price action for EURUSD.

Comment:

Friends,
The red Flag formation shows the daily USD weighted average. See how the price attempted twice to break the lower band of the Flag and just today it made a lower low but immediately spiked back into the lower band and EMAs.
I do not predict anything here but classic Flag formation normally breaks to the wrong side first. Fundamentally we have good data coming out of USD and 13 June we expect ANOTHER rate hike by FED.

and we have another Flag on Weekly !

Comment:

From a technical point of view I see the following price action as bullish.
See the last two candles on the weighted average EURO. Normally when we have a pullback from EMAs with a red candle (the one before the last candle) then we should see some follow through.
As you can see the last candle is just made a false breakout of the previous daily support level and bounced. On possible scenario is to see EURO visiting the FIBOs before further depreciation. But do not forgot that we have not seen a follow through for USD bearishness either.

Comment:

Dear Friends. I would wait for the close of the current 4hrs candle and I would keep my buy order above that.

Regards,

KHAN

Comment:

But if you do not want to have a big SL and reduce your trading size it is at a good price now.

Comment:

Just do not forget that EURO is just retracing now... Long term it is bearish ...

Comment:

If the price makes a higher high in the next 4hrs candle or next session, I will see 1.182 before going down considering that the last 4hrs candle was a bear trap.

Comment:

I have Fibo overlaps and channel overhead around 1.19. See this chart.

Remember EURO is a bearish market and it is retracing now so keep your stop below any swing low in a shorter TF.