Most may not agree with me but this morning's price action is slowly starting to convince me that the decline in EURUSD is over for now.
Here are my reasons for a EURUSD long to 1.289
1. Trend Lines: The weekly charts, I simply plotted trend lines and the past few weeks, price has been flirting with this old trend line.
2. RSI Failure Swing: My RSI uses 85 and 25. Traditional rules for failure swing is for a drop below 30, bounce above 30 and then a pull back holding above 30. Long on break of the interim peak. Applying this to 25 RSI level, you get the same thing.
3. Bullish divergence (not shown on chart): Daily charts show price making lower lows while RSI keeps making higher highs. With such lows being made, I see that the divergence is now ready to push prices higher.
4. Daily charts show three white soldiers (3 consecutive up days right near the bottom) with a decline yesterday. Appearance of this near a long term support that EURUSD has failed to break gives some validation.
This trade goes in line with USDCHF shorts I published a while back.
*Note: Publishing this chart a bit prematurely as a weekly close could offer a better bias.
*Note: So far daily candlestick is picking up to form a piercing line candlestick formation
*Note: Last Friday of the trading month, should see some profit booking in USD
*Note: I exited my short positions across EUR crosses. This is just a case study and does not imply to be a trade recommendation.
Here are my reasons for a EURUSD long to 1.289
1. Trend Lines: The weekly charts, I simply plotted trend lines and the past few weeks, price has been flirting with this old trend line.
2. RSI Failure Swing: My RSI uses 85 and 25. Traditional rules for failure swing is for a drop below 30, bounce above 30 and then a pull back holding above 30. Long on break of the interim peak. Applying this to 25 RSI level, you get the same thing.
3. Bullish divergence (not shown on chart): Daily charts show price making lower lows while RSI keeps making higher highs. With such lows being made, I see that the divergence is now ready to push prices higher.
4. Daily charts show three white soldiers (3 consecutive up days right near the bottom) with a decline yesterday. Appearance of this near a long term support that EURUSD has failed to break gives some validation.
This trade goes in line with USDCHF shorts I published a while back.
*Note: Publishing this chart a bit prematurely as a weekly close could offer a better bias.
*Note: So far daily candlestick is picking up to form a piercing line candlestick formation
*Note: Last Friday of the trading month, should see some profit booking in USD
*Note: I exited my short positions across EUR crosses. This is just a case study and does not imply to be a trade recommendation.
