EUR/USD: Rising Channel / Ascending Wedge - BE PATIENT!
Not the best currency pair to be getting involved with at the moment. There is a lot of possible scenarios developing and no clear direction. Not only are we within a range, but also in the middle of Channels, which is not an ideal entry point.
Identified are: 1) Ascending Wedge Pattern; 2) Channel #1; Channel #2;
At the time of this post, on a slow post xMas session, the market is range bound (Grey box). In short, a break above the range, followed by a pullback to the Mov Avg and bounce back up stands as a good bullish entry with TP at the red resistance levels. The opposite below the grey range would be a good short opportunity to the bottom trendines of the channels.
The trend is clearly bullish since retesting the support levels at 1.1720. The dotted ascending trend line and relatively low RSI level makes a good case for a Wedge pattern which would take the pair up towards the 3 red resistance levels to finish out the pattern. This upwards strength is also backed up by the retesting of the Mov Avg followed by strong pushes up forming candles with long tails.
On the other hand, if the wedge is merely apparent and we are within a Channel, the lower 1.18's stand as a good Long entry point when coinciding with the trendiness to then go back up to the red resistance levels within the plotted channels.
Staying patient will yield the most profit right now.
How we would take this trade:
Agressive Approach: Wait for the market to breakout of the Range. Wait for the pullback to Mov Avg and Support or Resistance levels of range (depending on the direction of the breakout) and get in there to the designated TPs (Red Resistance if bullish breakout, bottom of Channels if bearish breakout)
Safer Approach: Let the market reach the extremes of the channels and enter a trend reversal trade (Short at the top of Channels coinciding with resistance levels, Long at bottom of channel coinciding with Support).
Stay patient. Good Luck. Low Volume market right now, which can surprisingly be volatile when you least expect it and fake you out.
Identified are: 1) Ascending Wedge Pattern; 2) Channel #1; Channel #2;
At the time of this post, on a slow post xMas session, the market is range bound (Grey box). In short, a break above the range, followed by a pullback to the Mov Avg and bounce back up stands as a good bullish entry with TP at the red resistance levels. The opposite below the grey range would be a good short opportunity to the bottom trendines of the channels.
The trend is clearly bullish since retesting the support levels at 1.1720. The dotted ascending trend line and relatively low RSI level makes a good case for a Wedge pattern which would take the pair up towards the 3 red resistance levels to finish out the pattern. This upwards strength is also backed up by the retesting of the Mov Avg followed by strong pushes up forming candles with long tails.
On the other hand, if the wedge is merely apparent and we are within a Channel, the lower 1.18's stand as a good Long entry point when coinciding with the trendiness to then go back up to the red resistance levels within the plotted channels.
Staying patient will yield the most profit right now.
How we would take this trade:
Agressive Approach: Wait for the market to breakout of the Range. Wait for the pullback to Mov Avg and Support or Resistance levels of range (depending on the direction of the breakout) and get in there to the designated TPs (Red Resistance if bullish breakout, bottom of Channels if bearish breakout)
Safer Approach: Let the market reach the extremes of the channels and enter a trend reversal trade (Short at the top of Channels coinciding with resistance levels, Long at bottom of channel coinciding with Support).
Stay patient. Good Luck. Low Volume market right now, which can surprisingly be volatile when you least expect it and fake you out.