EURUSD WEEKLY CHART - Bullish Reversal at yearly Pivot Point S1
EURUSD WEEKLY CHART ANALYSIS
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I am not a position trader, I am a swing trader trading the daily and 4 hour time frames. However, I do believe in trading in the direction of the major trend. To determine the direction of the major trend I will often look at the monthly or yearly pivot points . In this chart I am looking at the yearly pivot points . In this chart I see the weekly candles testing support at "S1". Notice the lower candle wicks breaking below "S1" but the real bodies of these candle have not closed below this support level . Last week the weekly candle formed a Bullish Harami, a bullish reversal candle, indicating buyers have entered this market. Confirmation will come at the end of this week should this week's candle close above the close of last weeks candle. Even a more convincing tale would be if this weeks candle were to close above last weeks high.
With this market reversing upward I see resistance at the high of the high of the Doji printed on the chart in late June (see solid red line). Further notice there were two minor highs printed on the chart as shown by the dotted red lines. I found it interesting these minor highs were approximately 1/3 and 2/3's the distance from the high made in late June and support at "S1" Its interesting because I normally expect a fibonacci retracement of from 38.2% to 61.8% of the selloff from late June, and here these minor highs have shown me approximately where these retracement levels are. I guess you could also say these two minor high's show where the Gann retracement levels are! The point is, I would expect a retracement to at least one of these two area's, if not a complete retracement to the high made in late June before EURUSD launches another attack on yearly support from pivot point "S1".
In conclusion I will be waiting for a close below "S1" followed by a short setup on the daily chart before I will be considering a short trade in this market. Further a long trade to catch the retracement is higher risk so I would have to see at least a 3:1 reward to risk ratio trade setup before considering a counter-trend trade.
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I am not a position trader, I am a swing trader trading the daily and 4 hour time frames. However, I do believe in trading in the direction of the major trend. To determine the direction of the major trend I will often look at the monthly or yearly pivot points . In this chart I am looking at the yearly pivot points . In this chart I see the weekly candles testing support at "S1". Notice the lower candle wicks breaking below "S1" but the real bodies of these candle have not closed below this support level . Last week the weekly candle formed a Bullish Harami, a bullish reversal candle, indicating buyers have entered this market. Confirmation will come at the end of this week should this week's candle close above the close of last weeks candle. Even a more convincing tale would be if this weeks candle were to close above last weeks high.
With this market reversing upward I see resistance at the high of the high of the Doji printed on the chart in late June (see solid red line). Further notice there were two minor highs printed on the chart as shown by the dotted red lines. I found it interesting these minor highs were approximately 1/3 and 2/3's the distance from the high made in late June and support at "S1" Its interesting because I normally expect a fibonacci retracement of from 38.2% to 61.8% of the selloff from late June, and here these minor highs have shown me approximately where these retracement levels are. I guess you could also say these two minor high's show where the Gann retracement levels are! The point is, I would expect a retracement to at least one of these two area's, if not a complete retracement to the high made in late June before EURUSD launches another attack on yearly support from pivot point "S1".
In conclusion I will be waiting for a close below "S1" followed by a short setup on the daily chart before I will be considering a short trade in this market. Further a long trade to catch the retracement is higher risk so I would have to see at least a 3:1 reward to risk ratio trade setup before considering a counter-trend trade.