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EUR/USD: Tight Trading Range

ByAl Brooks
Published 06/07/2016, 09:17 AM

EUR/USD Daily Chart

The daily EUR/USD forex chart is in the middle of a trading range that began with the pullback from the bull reversal in early March. There is a Lower High Major Trend Reversal (LH MTR). A LH MTR is usually also a Head and Shoulders Top (HST). There is also a Lower Low Double Bottom (LL DB). All trading ranges always have credible buy and sell setups.

I mentioned yesterday that the EUR/USD daily forex chart would probably be mostly sideways for at least a few days after Friday’s buy climax. This is what often happens after a buy climax, and it is more likely because the rally reached the 1350 target that I have been writing about for a couple of weeks, and because it is now in the middle of its 3 month trading range. As always, if there is a strong breakout up or down, online day traders will swing trade. However, it is more likely that the range will be small for at least a couple of more days, and day traders will mostly scalp. The overnight range has been about 40 pips, which is narrow and a scalper’s market.

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Trading ranges often last much longer than what most traders think is possible. This trading range on the monthly has gone on for more than a year and there is no sign that it is about to end. The odds still favor a bear breakout. However, every bar that gets added reduces the probability, and after about 20 bars, the probability falls to that of the bears (about 50%). I do not have an opinion of when the breakout will come. There is slightly more chance that the bears will get their breakout than the bulls will get theirs, but the market is balanced and there is no sign yet as to when the breakout will come. I am neutral until the market tells me that the move has begun.
what do you think eur/usd when will get close to each other? is that posible this year? thx
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