EUR/USD: I mentioned last time that we were then in a Bullish Channel with support (then) at 1.0679 and resistance at 1.0894. We were also '...currently testing on a closing basis the resistance provided by the Medium MA...'. This resistance proved to be exemplary and we never managed to have a single close over it at the time or since. Indeed prices tested only the once over the key 50% Fib at 1.0819, by 10 tics and since failed. As a general guide, the Medium MA (currently 1.0673) has been a very good indicator of the bearish angle of attack of the market and after mid Feb, prices moved below the recent 50% Fib at 1.0584 which had acted as support and then resistance though the usual two consecutive closes underneath rule would not have worked that well as though there have been consecutive closes below 1.0584, they've not really been exploited.
Only other thing to add is that it did look till last Thursday as if we were about to try higher. There had not been a single close above 1.0584 for nearly two weeks. Then we had Friday's action...and what a great piece of action it was! In the teeth of two consecutive closes lower the market reverses up and closes above 1.0584 PLUS it actually closed at the very first real resistance following the move over 1.0584, namely, the Upper Tine of the Dec 2016 - Feb 2017 Bearish Andrews Pitchfork (currently 1.0607).
I couldn't have hoped for a better vindication of Technical Analysis - watch the Upper Tine for resistance. This has left us with a very interesting situation. The move higher has negated the recent try lower yet it is only one day up and it's gotten stuck at the first hurd le of resistance. Nevertheless, the Medium MA resistance is not that far away overhead and it might be reasonable to see if we can have a crack at that on Monday. If at the end of Monday we are still above 1.0584 and more importantly above the newly drawn 50% Fib at 1.0660, then we've got a possible bullish game on our hands. To sum up; key in the next couple of days will be consecutive closes above 1.0660 and the Medium MA or below 1.0584 and below the recent low at 1.0492.
At the moment it seems likely for a try higher, but watch for resistance. Of course, the market could just as easily go the third way and head sideways but in that case, please take a look at the Tine crossover on the 15th (circled). We already had one on the 28th of Feb (circled) which indicated the upper limit of the recent rally - the one on the 15th could indicate a possible trend change or a major volatile day. So, with all this in mind, I've moved the bullet point above into neutral from its previously mildly bullish outlook.
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