EUR/USD Fade Zone to Watch
The daily EUR/USD has traveled up higher into the resistance layer between previous highs at 1.3320 and 1.3355. Since the daily has no clear bullish or bearish Directional Bias, the chances of exhaustion are high. This opens the door to setting up a short sell as the chop on the daily could begin to enter an “overbought” area; but the entry is aggressive and dependent upon a few factors.
The daily EUR/USD has continues to chop within a range and with the intraday rally and pushed the boundaries of the range highs. This is not automatically a short sell but is certainly a consideration if the intraday time frames start to show fatigue from today’s climb.
The U.S. Dollar Index sell-off that has brought the greenback to the 78.00 level allowed the euro to gain against it. The risk was ON the table as U.S. equities rallied sharply higher.
Past performance is not indicative of future results
The daily EUR/USD has reached the area where selling pressure must be a consideration for intraday long positions. For end of day traders, intraday uptrends will be watched closely for fatigue and a reversal to confirm the fade betweem 1.3320 and 1.3350.
Since the pair has already shown that the moment is pressing 1.3350, that’s now the near-term floor. The key to this set up are what I call the “building blocks” of a market: Until the five and 15-minute time frames transition out of their respective uptrend by either moving sideways or breaking the uptrend, the daily simply won’t follow-through lower and therefore an entry short is akin to standing in front of a freight train.
As an active forex trader and Chief Currency Analyst for InterbankFX.com I do write for a number of sites all over the web and I am happy to say that I will be posting updates at www.IBFXconnect.com. My Activity Board will feature the trades from my trading account as well as intraday commentary.
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