[thrive_custom_box title=”” style=”dark” type=”color” color=”#fef5c4″ border=”fadf98″]
Important: I use New York close charts so that each 24-hour period closes at 5 pm EST.
Click here to get access to the same style charts I use on this website.
[/thrive_custom_box]
A few moments ago the EURUSD carved fresh 2018 lows. As I mentioned on Sunday, Euro bears have made a habit of this since breaking below wedge support on April 20.
I wanted to bring this morning’s drop to your attention because this is where I see a lot of traders get it wrong.
If you want to swing trade using end of day charts (remember, I use New York close charts), then it’s imperative that you wait until 5 pm EST. Otherwise, you’ll find yourself getting whipsawed by every intraday buying and selling spree.
Here’s an article I wrote on how to interpret the settlement period on a daily chart.
As for the EURUSD, it’s going to take a daily close at 5 pm EST below 1.1930 to open up downside targets. Those targets include 1.1830 and 1.1710.
But without the session close below the 1.1930 handle, we don’t have enough information to make a decision. The fact that sellers have taken out Friday’s low so quickly is a bearish sign. However, it isn’t enough to prompt an entry.
It’s also important to plan for the inevitable relief rally. Sellers are undoubtedly in control at the moment, and I don’t see that changing. But Euro bears just unwound four months of upward to sideways movement in twelve trading days.
It begs the questions: when will sellers reach a saturation point, even a temporary one? Will it be 1.1930, 1.1830 or a much lower level?
Time will tell. In the meantime, I’ll wait to see what happens here at 1.1930.
[thrive_custom_box title=”” style=”dark” type=”color” color=”#fef5c4″ border=”fadf98″]
Want to Learn How to Swing Trade?
Click Here to Get The Ultimate Forex Swing Trading Cheat Sheet
[/thrive_custom_box]
