Will the streak be broken today?
The EURUSD has closed higher lowerfor 10 straight days. Friday, the pair closed at 1.0587. We are trading at 1.0622ish now. So far, it looks as if, we stand a good chance that the 10 day streak will come to an end. Looking at the daily chart below, the low from last week (Friday), came in just above the cluster of swing lows from Nov/Dec 2015 at 1.0550-64 (the low reached 1.05685). When we could not take out that low today, and moved above the close from Friday (at 1.0587), the sellers turned to buyers.
You can see that on the 5 minute chart. Where? Well look at the low correction prices after the first few hours of trading...Those lows stalled at 1.05875. Sellers turned to dip buyers against the prior day's close.
Now what?
Sticking to the 5 minute chart, look for buyers against the 1.0612 area.
- It was the high earlier today
- It is where the 200 bar MA on the 5-minute chart is found
- It is near trend line intraday.
- It is near the 50% of the day's range.
I would expect buyers against the level, if the buyers are to remain in control. A move below will take some of the bullishness away from the day.
Is this low in place?
It is hard to break the back of a trend move. There was a lot of technical damage done in the pair on 10 days lower and the fundamental story continues to say Fed tightening, hope for fiscal policy, stronger growth. That is the story. So the story is still likely dollar stronger.
However, we know the market can get oversold and over bought. So there are those days (today?) where the story changes and often times, the technical picture helps that story line.
With the price comfortably above the close from Friday, the low's from Friday being near a support, and the market higher, the question will be, do the buyers today, keep the bias more positive and step higher. The 1.0612 area is a level to stay above.
