Kumowizard

EURUSD - Thoughts about a trend

FX:EURUSD   Euro Fx/U.S. Dollar
615 7 7
Monthly:
- Bearish trend setup. The big pictur is unlikely to change any time soon.
BUT there are a few questions here:
- 1,0750 is a 17 years (!!!) support/resistance level, which acted well in the past many times.
- Price dropped for 10 months (!) without any correction, and reached a 12 years low!
- Price got very far away from equilibrium levels (deep below Kumo and Kijun Sen) during last 10 months

The big question here is if:
A) 1,0700 - 1,0750 holds this time again?
B) Can we see a similar consolidation and pull back pattern like the one in 1997-1998?
C) We all understand the Euro             is bearish and will stay bearish , but should the USD be so bullish? I mean since I know my mind USA has been accumulating C/A deficit, US debt has been increasing + FED after all printed 4000 bn USD in last 6 years. We hear talking heads saying there is USD shortage on the market...hmmm, is there really?

Weekly:
Not much to add, you can see how strong this trend was/is, and we see the same issues here:
- Weekly candles could not even make a Kijun Sen retest in this downtrend! Actually they never closed above Tenkan Sen (9 weeks avg)
- Price is like a falling knife and got very far away from Kumo and Kijun Sen

This is just an observation. No indication to go against the trend. I have to admit I thought it was oversold at 1,19 and also at 1,15, which means regardless my entry between 1,35-1,37 was pretty good, and I made some money, I got out too early and missed all this move from 1,19 down to 1,0750. But maybe it is time to think again about what is priced into this pair, and if the pricing needs some adjustment by the market sometimes in the close future.
It may happen that it collapses with the same pace down to 1,00, but it has some chance that we finally see some consolidation, pull back, and these one way moves we got used to will change and will materialise in more volatility.
geopapa
2 years ago
IMO this pair will test 1.0444 en route to the 1.000 if 1.0444-1.0349 barrier fails to hold. Also a point to note is that the Dollar index is still very strong
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Kumowizard PRO geopapa
2 years ago
Sure, as USD Indx has a massive EUR overweight.
Well, yes, the trend is not a question. That's why I wrote it is hard to immagine a change in the big picture. However the question is if a pull back or consolidation is due or not? I have never seen this kind of move neither in USD Indx nor in EURUSD, when not even a minor correction happened. 10 month in a row... that puts some question marks. Certanly, it will remain a sell on tops, but I don't think it is a good risk reward for those who enter eurusd shorts here.
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geopapa Kumowizard
2 years ago
I agree...sell on top with tight sl is the best approach but caution is needed here. I want to setup at around the 1.04373 area for potential reversal else the pair will fall deeper
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Helder Castro
2 years ago
Very nice comment ! I have the same question also in EURGBP, because the prices are right in a resistance line (see monthly graph), and I will be watching it, because it will probably give us a very good oportunity to enter long, or short...
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geopapa Helder Castro
2 years ago
The pair is still bearish looking to breach the 0.71132 level. IMO 0.68704 - 0.65376is the decision level or rather a potential reversal level because the major levels of 0.78638 and 0.73319 has been broken hence price will target those reversal levels. I will advice to stay in the trade(bear) and wait for those levels to hold before a long entry
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Kumowizard PRO Helder Castro
2 years ago
EURGBP I do not really track and trade. However GBPUSD I do. There I see strong resistance at 1,50. Also see some chance that it will spike from here. Will post analysis soon.
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It's like in the old Boney-M song! USD is a one "way ticket to the moon!"
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