Range is narrow at 72 pips
The EURUSD gapped lower after the weekend meetings with Greece lasted a whooping 45 minutes. The pair remains confined but the energy is building.
Looking at the hourly chart, the high was a nice play to turn around:
- The price filled the gap from the close
- The price stayed below the 50% of the move down from last weeks high to
last week'sFriday's low (at 1.1268 - The price stayed below the 100 hour MA (blue line - currently at 1.1261 and moving lower)
- The price stayed below the downward sloping trend line also currently at 1.1261.
- Might as well add, the price stayed below the swing low from last Wednesday (at 1.1259). I can see it. Other's can too.
The high reached 1.12596.
The low to high trading range today is a light 72 pips (all the major pairs against the US dollar are running short of their 22 day average ranges (72 pips vs a 22 day average of around 148 pips). The pair is trading around mid range for the day. If the range is to be extended which way do you think? Above or below? It would seem to me with Greece situation in a stalemate still (Merkel says where "There is a will, there is a way" . Does Greece leaders have the politically unpopular "will" to cut pensions?), that rallies would be sold. Look for patient sellers against the 38.2% and 200 hour MA (the price went above each with no closes above each). If a price rally stalls there, we get a move lower, and the break below the lower trend line should be enough to give a push, to and through the low for the day, with the next target being the 1.1150 low from last weeks trading.
If the price extends above this resistance area, there is still the chance all that stuff above holds the line, but remember the range is still narrow and squeeze plays have been more and more prevalent, so be cautious. There is always another trade.