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It’s not a matter of “top picking” as I am not in the least interested in getting short.

I’m certainly not looking for a near-term fade either since the short-term time frame that I could consider are still in roaring mark up trends.

With solid green GRaB candles on the daily and a “twelve to two o’clock” 34EMA Wave, there is bullish sentiment, bullish momentum, and – you guessed it! – a bullish trend on the EUR/USD.

4-26-2011 8-42-09 PM.jpg
EUR/USD daily chart with a Channel Up chart pattern alert courtesy of Autochartist

It’s inevitable that trader will look at this pair and consider it “overbought” and “toppy”. In my opinion (which reflect my analysis!) the trend is up as long as the 34EMA Wave is moving higher at “twelve to two o’clock” and it holding as support. As long as this is the case, the Directional Bias of the pair is UP and this increases the likelihood that pullbacks will continue to be bought into.

I think that the price action on April 18 caused many traders to take COUNTER-TREND entries short on longer-term time frames because of the depth of the pullback. In reality the move lower was a swing BUY as prices found buying support within the 34EMA Wave while simultaneously testing the uptrend line support of the Channel Up.

By the way, I am NOT AGAINST counter-trend entries, however I only take them on short-term time frames which for me are the five, 15, and 30-minute.

The reason then for why I’d like to see exhaustion between the 1.4700 major psychological level and the 1.4720 minor psychological level is so that I can see the EUR/USD correct lower into support and BUY INTO IT.

I don’t see 74.00 holding as support for very long despite many traders feeling that a low may be put in. I am not looking to pick a bottom in the U.S. Dollar either…

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