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EUR/USD Labyrinth

By Alex WinnerForexSep 14, 2018 12:26PM ET
www.investing.com/analysis/eurusd-labyrinth-200343925
EUR/USD Labyrinth
By Alex Winner   |  Sep 14, 2018 12:26PM ET
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Forex is mathematical. If you know the algorithm it runs on then you are sleeping on a pile of gold. It appears the PA likes to bounce between trendlines, especially since it created a symmetrical triangle in the summer. This effect is a result of the mixed views that persist among traders in regards to the pair's exchange rate. It resembles a musical between bulls and bears.

EUR/USD's price made a top at ~1.1722 during the EU session earlier Today. It mirrors a double top together with the previous higher high at ~1.1734 on the 4h chart. It also touched the upper limit of the expanding triangle it tries to sketch. Thus, it should be headed now towards the lower limit of the triangle. But on the way, there are key trendlines it could dance on.

The first line one has to look at is the violet one which will put resistance in the event the price attempts to move back up. The second line is the gray one which could define Today's low. The third line is the teal one which will provide temporary support sometimes next week as it is the upper limit of the previous triangle.

The other 3 lines that will act as support and resistance are the orange, blue and green that alike the previous ones intersect in the same place. Right through that intersection, an extended dip could happen and so bring the price onto the lower limit of the triangle.

One last element to be taken into consideration is the bearish divergence on the 1h chart that has yet to develop on the 4h chart. Odds are for a hidden one.

EUR/USD
EUR/USD

EUR/USD Labyrinth
 
EUR/USD Labyrinth

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Gábor Lantos
Gábor Lantos Sep 14, 2018 11:34PM ET
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Dear Alex, I think one line is missing from the chart what is parallel with the blue line but lower, marking a short-term bullish channel. if you draw that line on your chart, it will show a completely different picture.
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Jwalin Patel
Jwalin Sep 14, 2018 4:16PM ET
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Nice article...Best of Luck!
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Black Wolf
Black Wolf Sep 14, 2018 3:19PM ET
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Do you think once hits the bottom it will pop up to 1.18 1.19 before plummeting, lookinng at the day chart theres a massive head and shoulders it looks like we should be seeing a huge drop coming soon.
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Alex Winner
Alex Winner Sep 14, 2018 3:19PM ET
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Yes, if it doesn't break the lower limit of the triangle, it will reach 1.18x on the way up.
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Beast Mode
Beast Mode Sep 14, 2018 1:17PM ET
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Thank you Alex for your very insightful article. Question, do you think we will break the triangle anytime soon or will it continue to contain the EURUSD and expand with each bull and bear run? Looking forward to your next article!!!
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Alex Winner
Alex Winner Sep 14, 2018 1:17PM ET
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I think it will stay within in the next 4 weeks.
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Disclaimer: Do not put your capital at risk by following any forecast provided without creating your own analysis and trading plan. The content is not an investment advice. The author does not offer financial services or signals.
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