Bears have not proven they have taken more control
The EURUSD rallied strongly after the NFP report and by the time 9 AM ET/1300 GMT rolled around a high at 1.1282 was reached (see post from shortly after the report). That was above the May high high at 1.12678, and in the process, it made a new high going back to the ubiquitous US election day. The not so good news is that the ubiquitous US election day high at 1.1300 (give or take a pip or two) was still 18 pips above.
So what happened since?
The correction lower came down and found support in the 1.1250-56 area. That was the area I earmarked in the earlier post, where buyers should show up IF the pair is continue the move higher. Boom.... the buyers showed up at 1.1254 and the price has remained above that support floor.
The not so good news, the price highs since has not been able to extend above the day's high, let alone get to the 1.1300 key target. The highs have come in at 1.1279 and 1.12809 respectively. The market also took the price back down to the support and retested that level (see 5 minute chart below).
Now, the pattern looks bull pennant-ish....sorta....kinda. So bulls remain in control. However, we know what looms ahead and why the market is having some apprehension. As a result the battle goes on and technically, we can break either way.
SUMMARY: There is more bullish than bearish (bulls remain in control and the sellers are not all that convincing), but there is also some good and bad for the bulls. The new battle lines are drawn with 1.1250-56 as the low support and 1.1282, and then 1.1300 as upside resistance targets. We sit in the middle while the spring tightens. Time will tell, but the lines are drawn.
