The big players are getting set for another crucial decision on EURUSD just like in February (updated) ~ forex trader les news
Trading forex is all about knowledge and a deep understanding of the market. What I want to share today is an interesting development on EURUSD concerning the interplay between fundamental and technical analyses. The big players are getting set for a crucial decision on EURUSD just like they did in February 2010.
If you look at the weekly charts, you will observed that for three straight weeks price opened and closed almost at exact points, thus forming three stars. A star on the weekly chart is a sign of expectation, a tug of war between the big players. Where you have three stars, is an indication that something very big is about to happen. What is about to happen? We may not know it, but a review of the past will give us an indication.
Now, let us look at the past. If you look carefully at the weekly chart, you will notice a similar three stars in February this year. That was the period when there was serious concern about the economy of EU countries. Specifically, the debt situation in Greece and other EU countries. At that period the technical analysis on the daily, weekly indicated that the price had reached the bottom and was ready for a reverse from around 1.35000 after falling a by over 1,000 pips from 1.51000. The To the surprise of most traders, the fear about the economic conditions of most European countries, represented by fundamental analyis carried the day. EURUSD fell to its lowest point at 1.18757 which was an additional 1545 thus making a total of about 3224 pips from its highest point in November 2009.
Now,to the present the weekly and daily clearly RIS indicate that EURUSD that around 1.40000 is the peak and that the pair is due for a reverse. However, there is fear about the state of the US economy, the apparent failure of the economic stimulus package, possible weakening of Democrats by the mid-term elections, the price of gold etc. These fears are indicated by the three weekly stars and the Euro appears a better alternative to the big players. In the light of this, the big players are most likely ready to push the pair up to 1.60000 but a trip back is to 1.18757 is not impossible. The decision is theirs. The best option for a retail trader is to follow them. We are currently at a cross-road.
The monthly RSI indicates that the price is the middle of the monthly RSI, just like it showed in February 2010. A break out of the blue box will show us the decisions of the big boys. As usual a weekly candle below or above is a signal. This is the big picture. Relevant charts are attached.
For daily players, the blue box (1.37000 - 1.41000) is our playground for now, follow the daily candle for direction, H4 for trade signals and M15 for entries.
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