NFP Bears gathering their troops? or will the Bulls stampede...The past 9 days have been quite interesting for the EUR/USD which has been relentless. Price has been rising like a helium balloon let loose at the park...
Bulls have clearly been in control, not only the past 9 days but since the beginning of the year with the exception of the strong pullback in April & May only to bounce for another 700 pip run.
I am totally USD bearish across the board as I have been mentioning in my analysis videos for the past few months but like all macro moves, we always have pullbacks along the way and that is why I have been shorting the EUR/USD back from 1.1500+ - 1.1700+
I've given this a lot of room to breathe, more than usual but considering the following technical setup, I'm willing to give the Bears some leeway and potentially show me they'll come through.
•Rising Broadening pattern (Where two trendlines start close together only to divergence and expand) - This is a bearish pattern.
•Negative Divergence on the MACD, Linear Regression & the RSI.
•Price has made a run to the yearly R3 pivot level. (Rare extension)
•Last daily candle is a hanging man candlestick (Reversal candle)
•Weekly chart has the EUR/USD at the upper band of a polynomial regression channel which calculates for price extremities in the market.
There are a few more setups as well but it's too much to describe here and I'd have to show it in a video (Which I plan to do over the weekend)
With all of that said... It could all fail lol but seriously speaking... You just can't ask for a better probabilistic setup so whatever happens during NFP... happens.
Aside from the technical aspect... I know yearly R2 around 1.1600 was a hotspot for shorts because divergence was at the early stages and taking a short there wouldn't have been a bad idea but we know institutions are in play as well, so above 1.1600 could have been a huge area to run stop losses and margin calls before a potential reversal.
250 pips would be enough to run a large pool of stops and liquidation.
IF price is going to reverse here during NFP, I believe late longs and breakout/pullback traders are going to try and buy at the trendline at 1.1660ish but it wont hold and trap them on the other side of the trade.
Under that, I can see us pulling back towards 1.1200ish...
If the Bears give up and price continues to climb... the original macro target may very well be under way which was 1.2000 - 1.2200 (Based on a Monthly and 3-Month chart analysis)
As of this writing the EUR/USD is pretty much completely flat which is expected before the NFP fireworks ahead of July 4th.
We'll see what happens tomorrow morning! buckle up!
As always, Good luck and Trade Safe! See you post NFP.
