Triple Top Broken, Looking Up From Trend Line
Last week, the danger of a trend break emerged as we saw what could have been a Bearish Engulfing as the US Dollar strengthened following statements at that weekend’s G7 summit. We opted to remain on the sidelines and wait for the market to tell us how best to proceed.
The bearish reversal did not materialize. Rather, EURUSD broke through triple top resistance at 1.5900 with a Long White Candle. A lull in US and European data at last week’s end prompted what looked to be a technically driven relief retracement. This saw the pair decline to trend line support. From here, we continue to believe that EURUSD will test 1.6000. Current positioning at the trend line offers a good entry point.
EUR/USD Trading Strategy
1. Long EURUSD at trend line support above 1.5800
2. Set stop-loss below last week’s low at 1.5701
3. Set target at 1.6000
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