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EUR/USD Likely to Trade in a Range

Published 04/24/2023, 09:27 AM
Updated 07/09/2023, 06:31 AM
EUR/USD
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EUR/USD Daily Chart

  • The EUR/USD is trying to reverse up to the April 13th high close. It was reasonable for the bulls to buy the April 13th close and scale in lower.
  • Traders are waiting to see how disappointed the bulls are. If the bulls are eager to exit back at the April 13th close, it will create a resistance level as both bulls and bears begin to sell at that price.
  • If the bulls buy more at the April 13th close, it would trap the bears selling at the April 13th close, and the market could breakout above the range.
  • More likely, the market is transitioning into a trading range. This means that there are probably sellers above, scaling in higher.
  • The bears are beginning to form bear bars closing on their lows, which is good. However, the bears need to start getting closes below the moving average (blue line).
  • At the moment, the bulls have more than 20 bars completely above the moving average, which is a sign of strength and a warning that the bulls are probably still in control.
  • If the bears can prevent a successful breakout above the April high, it would not take much for traders to decide that the past two months is a trading range. This would likely lead to a test of the midpoint of the past two months.

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