- Yesterday,EUR/USD bulls got a strong breakout bar closing, and it’s high and far above May 5th high. This is probably a strong enough surprise to make the market always in long.
- Bulls need to follow through today. They hope they can get a strong follow-through bar similar to yesterday’s bull breakout bar.
- Bulls got to within 20 pips of the March – April trading range low and will likely get there today or within the next couple of days.
- The bull breakout of the May 5th high may lead to a measured move projection from the May 16 low to the May 5 high, which would project to the April 21 high. April 21 high is a major lower high and a likely target for the bulls.
- Bears want to prevent the bulls from getting follow-through today. They hope today will be like the May 17 and May 19 breakouts that both had bad follow-through on the next bar. The problem the bears have here is that yesterday’s bull breakout bar is a surprise which will cause traders to expect a second leg up.
- Also, it is worth mentioning that the bulls have a 7-bar bull microchannel, increasing the odds of the first reversal being minor.
- Overall, traders will pay close attention to see what follow-through the bulls get after yesterday’s bull breakout. If today is a big bull follow-through bar closing on its high, the market may race up to the April 21 high. If today is disappointing for the bulls, it may lead to confusion and cause a pullback.
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