EURUSD bulls are trying to break free, but aren’t quite there, yet.
From a technical perspective, the euro has been a mess. There’s no other way to say it.
Ever since the pair dropped below the 1.1450 area on October 24th, we’ve seen nothing but false breaks and sideways movement.
There’s no doubt the broader trend is bearish. It has been since the April 20th breakdown I pointed out on this website.
But the mid-November bounce from 1.1215 turned me neutral.
It wasn’t just the bounce though. It was how it unfolded.
Between November 7th and 12th, EURUSD lost 280 pips. However, the next five trading days erased all but 35 pips of that 280 pip selloff.
That type of aggressive buying isn’t something you want to ignore.
Yet despite the November rally, there hasn’t been a favorable buying opportunity here in my opinion.
Any long entry below 1.1450 is one in a sideways market. That leaves you holding your breath in hopes that buyers get the job done.
That isn’t a position you should put yourself in, quite literally.
The solution is to wait for EURUSD to clear the current range. Buyers are close to doing just that today, but they aren’t there yet.
A daily close above the trend line from the November 7th high would be a start. But I think it’s going to take a close above 1.1450 to seal the deal for euro bulls.
The “daily close” refers to 5 pm EST. If you aren’t using charts with this closing time, you’re exposing yourself to false breaks.
Click here to get instant access to the same New York close charts I use.
That would be something that hasn’t occurred since October 23rd. It would also expose resistance at 1.1530 followed by 1.1620.
If we look at the price action since August, there’s a very good chance EURUSD could target the 1.1700 area if it can clear 1.1450 resistance.
Until then, this is a sideways market and one I won’t touch.