Taking the analysis on the Dollar Index into consideration (note the Dxy I use is not weighted) we have Dollar pairs trading in a similar fashion. When looking at EURUSD daily you will notice that price is currently in the middle of the range with the future strength or weakness of the Dollar to decide the direction of the next trend. As with our view on the Dollar, one could wait for price to be at support (bottom of the range) or resistance (top of the range) or wait for a breakout.

Below are the scenarios for bulls and bears for the week ahead. I have also included a view of March with next month’s pivot points taken into consideration.

EURUSD Daily

Price is not at the bottom of the range. The daily stoch is bearish. 122 marks the bottom of the range. Price moving down to the bottom of the range is scenario A. There is less evidence to support price moving to the top of the range though nonetheless I have marked this as scenario B.

EURUSD H4 Scenario A

If your bias sees price moving down to the bottom of the range then resistance at WPP or WM3 is where you are looking to sell. This gives us a target of WM1/ WS2, which is the bottom of the range. Note the H4 stoch is bearish. If support does not hold then waiting for a pullback to confluence of MPP/ WM2 would provide resistance to short.

EURUSD H4 Scenario B

If your bias sees price heading up to the top of the range then confluence of MPP and WM2 is support and you would look for opportunities to go long with the aim of price moving higher and breaking through 1.2350 and a target of WM4/ WR2, which is the top of the range.

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