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EUR/USD: Bear Breakout, First Upward Reversal Should Be A Minor One

Published 09/26/2022, 09:25 AM
EUR/USD
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USD/EUR
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EUR/USD Daily Chart

  • Bears did a great job last week getting a breakout below the September low.
  • The past four days are strong enough that the first reversal up will likely be minor and lead sideways to down.
  • The risk the bears have down here is that this is late in a bear trend that will probably end soon. This means that the current selloff might be exhausted and lead to a reversal.
  • Bulls will need a strong bull breakout, or a micro double bottom, before most traders are eager to buy.
  • Traders should expect sideways soon as the bears will likely take profits down here.
  • While this breakout may continue lower, the EUR/USD will likely have to test the September 6 breakout point soon and the resolve of both the bulls and the bears.
  • Lastly, investors see 1.000 as a fundamental price level. They will know any time the market is below 1.000 as a value buy and an excellent opportunity to buy the EURUSD at a cheap price. This makes me think the market will have to get back to 1.000 soon and will have a hard time getting far away from it.
  • Overall, traders expect the bears to become disappointed in a day or two, bears begin to take profits, and aggressive bulls buy for a scalp.

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