Fails on break higher. UGH. Greece still weighing on traders minds and keeps the pair confined.

We are midway through the trading week and the EURUSD has a trading range of 191 pips. ON May 24, the range was 190 pips. ON Feb 8 and Feb 15 the range for the week was 173 and 172 pips. If the EURUSD stayed inside the current range with 1.10945 as the high and 1.10915 as the low, it would be the 4th lowest range week this year (we are half way through). Can it remain low (i.e., keep the same range)? Yes. It it likely? UMMM.... I like to think at some point a boundary will be broken.

Looking at the hourly chart above, the pair gave the good ole college effort to break above the 100 hour MA and the topside trend line at the 1.1047 level. The price should have moved higher on the break of this technical level - after all it has tested each a number of times. However, the price got to 1.1057 and then 1.1059 before falling back below the levels. There were no closes above the MA. It the price cannot go higher, it needs to go lower. The price fell below the 100 day MA at 1.1030 and fell to the 38.2% of the move higher from the weeks low. Stop on the 38.2% at 1.10046.

The price is now moving back higher - trading above the 100 day moving average. Staying below the trend line and 100 hour MA we have been following.

What to make of it?

This is the definition of a market that is not sure of itself. Does it have a technical bias? Boy that is a tough one too.

Bulllish.

  • We are above the 38.2%-50% of the move off the low
  • We are above the midpoint of the 5 month trading range (see daily chart below) at the 1.09638
  • Intraday I can say the price is above 100 and 200 bar MA on the 5 minute chart (not shown) at 1.1020 and 1.1009 respectively

Bearish.

  • We failed on the break above the trend line
  • We failed on the break above the 100 hour MA

Netural.

  • We are trading above and below the 100 day MA at the 1.1030

If you like the downside, get below the 1.1000 area and move below and stay below the 1.09638 level (50% of the lifetime range.

If you fancy the upside, get and stay above the trend line and the 100 hour MA 1.1045 currently.

Play a break of those extremes? Sell against the 100 hour MA? Buy against the 1.10000 area? All are low risk plays depending on your bias.

Another option is to wait it out and focus on another pair with an eye for a momentum break or more news that makes the picture clearer. Right now the picture is a bit fuzzy.