Daily Price Action
Shares

EURUSD: Selling Pressure Mounts Below 1.1720

Shares

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 charts I use.

If you read Sunday’s forecast, you know I wasn’t keen on the idea of buying the EURUSD. I even wrote that I was in no hurry to buy the pair.

I also pointed out the lack of momentum since the beginning of June. For nearly two months, the single currency has been range bound following the 800 pip drop that commenced with the April 20th breakdown.

This consolidation looks more like a continuation pattern to me than anything else. That’s how I’ve been treating it ever since the pair sold off from the 1.1830 handle on June 14th.

As I write this, Friday’s bullish pin bar is failing. The pair has taken out its low at 1.1612 and isn’t far from reaching the range low at 1.1520/30.

That pin bar, by the way, is the one I denounced on Sunday. Here’s what I wrote:

Friday’s signal is no doubt a bullish one. The shape of the candlestick is ideal and it also formed at a key support area.

However, keep in mind that the EURUSD is still range bound. There hasn’t been any momentum one way or the other since the single currency broke below 1.1830 on May 16th.

You may also know how I feel about Friday signals. Essentially, the lack of volume before the weekend tends to produce patterns with relatively high rates of failure.

The bottom line is that we were waiting to see if Friday’s signal was a directional cue or simply a liquidation event before the weekend. It seems we now have our answer.

So where to from here?

At the moment, the EURUSD is trading below that 2017 trend line on an intraday basis. I mentioned this level a few weeks ago. If the pair closes the day below it (New York 5 pm EST), we will likely see offers develop near 1.1630.

Note that the pair has broken this level once before, though. The June 28th breakdown ended up being a false break in the end. Evidently, the range support at 1.1520/30 was too strong.

It’s going to take a daily close below 1.1520/30 to open up downside targets including 1.1440 and 1.1300. That said, I do think a daily close below the trend line near 1.1620/30 would trigger another round of selling pressure.

If buyers can manage to keep the pair above that 1.1620/30 area into today’s close, we could see a bid develop. Just keep in mind that the 1.1720 resistance level which I also mentioned on Sunday isn’t far away.

Want to See How We’re Trading This?

Click Here to Join Us and Save 40% – Ends July 31st!

EURUSD daily time frame

Leave a Comment:

15 comments
Robert DeCuir says

Based upon your lesson covering pin bars and your recommendation on trading them, if you had used Friday’s bullish pin bar as a possible set up (with the set up not being hit), would you have left that opportunity open for a few days or simply end that opportunity and continue to look for the next one?

Reply
    Justin Bennett says

    Robert, as I mentioned, Friday’s pin bar wasn’t ideal because the market has been range bound and the fact that the pin bar formed on a Friday. Not to mention the fact that 1.1720 was too close to justify a long entry.

    Reply
      Robert DeCuir says

      Thank you for your time and explanation.

      Reply
Uche Nnaji says

I like following ur feeds though not making much out of it yet,but I will persevere to pay attention!

Reply
    Justin Bennett says

    Let me know if you have questions.

    Reply
Adeniyi says

This is to confirm that you are good in what you are doing keep it up.

Reply
    Justin Bennett says

    Thanks for that. Cheers.

    Reply
Bogatsu says

It bounced at around 1.1625 and looks like 1.1720 is in the picture again.

Reply
    Justin Bennett says

    You’re referring to intraday price action which doesn’t mean a whole lot.

    Reply
Jeor Mormont says

Your analysis are great, however, as I can observe you are plotting too much key levels which gives confusion and complexity. I think you do not need to plot all the levels but only the “Key” levels. Hope you have an article of different levels, i think not all levels are “key” levels.

Reply
    Justin Bennett says

    When dealing with the EURUSD, I don’t consider having 100+ pips between each horizontal level to be overdoing it.

    In my opinion, the levels above are all key levels. The price action over the last few months tells us that much.

    Reply
      nadzuah says

      thts rigth justin….

      Reply
olayinka says

Justin thanks for for you great work . your lessons had improved my trading confidence. We have a close above 1.1620 , we you consider a long you.

Reply
    Justin Bennett says

    You’re welcome. No, not at this time.

    Reply
Eimantas says

Hi, Justin. Good news from You about selling presure. Thanks a lot.
I watching something like Head and Shoulders in eur/usd Dayly time frame. Strange structure. 43 days consolidation, uptrend 71 days, cosolidation 43days again, downtrend 71 days and again consolidation, now not inaf several days until 43 in right side.
Temporary support 1,15717, support 1,15105. Highest point (head) 2018,02,16 candle. May bye it is road to hel for me, but I will try to take it 🙂

Reply
Add Your Reply