Word up, peeps! It’s a fresh week, but we’ll start this week’s intraday charts update a by talking a walk down memory lane as we revisit our old setups on EUR/USD and EUR/AUD. And it goes without sayin’ that we’ll be lookin’ for fresh plays as well.
Unfortunately, the pair opted trading sideways after that. Even so, our game plan still played out anyway since the pair broke higher past 1.5430 and then hit 1.5680 as expected.
Anyhow, the pair will likely continue to move higher, so our bias is still mainly bullish. However, the pair appears to be pulling back for now. Today’s play would therefore be a retracement setup.
And using our Fibonacci tool, we can see that the 50% retracement level is the area to watch since it lines up rather nicely with the area of interest at 1.5510. Moreover, the pair will be testing the 100 SMA by then, and the 100 SMA may act as dynamic support.
However, there’s also a risk that the pullback could be deeper, with the broken resistance area at 1.5430 being the price area to watch since it lies just below the 61.8% retracement level and right smack on the 200 SMA.
As always, however, there’s a risk that the pullback may end up being the start of a trend change. So if the pair continues to move lower past 1.5430 on strong bearish momentum, then y’all may wanna bail yo longs or even switch to a more bearish bias on the pair.
Since then, the pair to break to the upside and even took out the area of interest at 1.2320, as y’all can plainly see. So if you were able to ride the upswing, then give yo self a pat on the back for a job well done in bagging all them pips.
Anyhow, if we take the most recent price action into account, we can see that a fresh ascending triangle appears to have formed.
As it says on the tin, an ascending triangle is a bullish forex chart pattern, so we’re mainly bullish on the pair. We’re therefore waiting for a clear break past 1.2530, with the expectation that the pair will likely have enough “oomph” for a 200-pip move.
However, there’s also a slim chance that the pair may break to the downside instead. Y’all may therefore wanna prepare for such a scenario as well. Just make sure to keep a close eye on how the pair reacts to 1.2320 and 1.2220 since bull will likely be waiting there.
In any case, just remember to practice proper risk management as always, a’ight?