But, will the buyers love you tomorrow?
OK....I don't what prompted these thoughts, except to say that trading is like love...
-----------------------------------------------------------------------------------------
Trader 1: The EURUSD found some love today.
Trader 2: What kind of love?
Trader 1: Well, it may be the start of something good for the buyers. It may fizzle. But the first date was not bad.
Trader 2: Let's hear some details....
Trader 1: For one the trading range was able to get to the 22-day average (the range today is 98 pips, the average is 99 pips). That beats the last two trading days when the range was 56 and 65.
Trader 2: What else?
Trader 1:The price based at the 200 hour MA (green line in the chart above) and trend line.
Trader 2: And?
Trader 1: The price moved above topside channel trend line.
Tradier 2: OK, sounds promising (and looks promising) is that it?
Trader 1: It also moved above an area that has been a ceiling and a BREAK area going back to December 29th. The last three looks above this area (from 1.09396-1.09457) failed the day it broke. The day is not over but it remains above that area.
Trader 2: Is there work to be done?
Trader 1: There is always work to be done if you love a currency pair, but it takes time especially after the last relationship (to the sell side) failed so abruptly when the ECB failed to add more QE back in December.
Trader 2: So what are the hurdles for a stronger love in this currency pair?
Trader 1:
- There are the highs from Jan 11 at 1.0969 and Jan 20 at 1.0975 and Jan 15 at 1.09839.
- There is the 100 day MA at the 1.0982 level and the highs from end of December at 1.0992 and the 200 day MA at 1.10517, and the
- 50% retracement at 1.1115. A move above that would really open the door to the upside and more bullish love.
Trader 2: Any other hurdles?
Trader 1: Well there are those that love the sell side. There is a strong commitment of traders to the sell side. Most traders according to statistics don't favor the buy side. In fact they love the sell side.
Trader 2: So why isn't it going down today?
Trader 1: I don't know, but perhaps the sell side has not been treated all that well. Last week - and early this week - it looked like things were looking good for the sellers. Then the relationship soured near the 1.0788 level.
Trader 2: Wasn't that a level of importance from ECB day back in December?
Trader 1: Yes...it was a low correction price on that day. The market has as long memory.
Trader 2: Well, good luck...
Trader 1: Thanks. I will give the buyer the benefit of the doubt, but if the price starts to fail and wander back below the 1.0939 level, I might have to reevaluate the relationship. The last three times we've gone above that level, I found out the buyers were not so enamored. They switched to the sell side....So, I will be watching closely to see what kind of reaction occurs on a move back below that level.
Trader 2: Sounds like you have a plan...
; )