Transcript of Video
From Forex Traders Daily, this is your daily analysis with Ross Mullins, live from Richmond, Virginia.
Hello everyone, this is today’s video analysis for June 15, 2017. Today we’re going to be taking a look at the Euro versus the US Dollar [EURUSD] for today’s trade analysis.
Now, of course yesterday we had the big news out of the FOMC. The raise of interest rates causing the USD to have a surge across the board across all the US currency pairs, and we see that continuing again today. Here, on the EURUSD, we could see that overall we have been in an uptrend. Not too hard to see above the black trend line.
Over the past few weeks though, we’ve been in a period of congestion, ranging at the very top of the trend, where we’ve been bouncing around inside the black box between the orange zone. That’s 1.1260 to 1.1285, and the pink zone, 1.1200 down to 1.1165. And we could see we’ve been bouncing around in there for several days. We’re challenging the bottom of that range or congestion, the box, and the trend line today. You could see yesterday’s candle, big candle or big wick sticking on top of the blue candle, falling from the orange zone, down to the pink zone. Today pressuring the bottom side, pressuring 1.1165.
If the market can break through 1.1165, we’ve already seen it one time break all the way down to the green zone. So, it wouldn’t be too difficult to see at least a push from 1.1165, down to 1.1110, which is the green zone, which is pretty much what happened here. And of course a break through the green zone, a further movement lower would be expected. But really the biggest news here today will be the breakdown of this pink zone. 1.1165.
Now, we want to be sure of it. We don’t want a false breakout. This ended up being a false breakout, where it dipped its toes into the water if you will down to the green zone, suddenly reversed and went back up. We don’t want that to happen to us. So, how do we protect ourselves in case the market is going to turn right back around and go back up? Well, I’m typically going to be looking for an open and close. A singular candle body that opens and closes underneath that pink zone, either here on the daily timeframe or on the four-hour.
A couple of other things. We could see these triple tops sitting here. Three times testing into 1.1260 to 1.1285. So, giving me some confidence to look for the short. Of course yesterday’s USD move also giving me some confidence to look for that as well. Now, if you were in the live Trade Room yesterday, you know we discussed the ongoing short from 1.1265, from the orange-shaded area. Currently sitting nearly 100 pips of profit on the trade. If you were in that trade, you should be protecting profit on that trade.
This is a new opportunity that we’re looking for with the breakdown of the trend line and the pink-shaded area. Zoom it in a little bit. You could see the five days or so, six days sitting on top of the pink zone. The rally prior to the FOMC news. The rally was actually on some poor news out of the US with retail sales data. Pressuring into the orange-shaded area. Then we got the FOMC news and a fall right back down.
Let’s take a look at what that looks like on the four-hour timeframe. And you could see as you get down here, pretty wild day here for the EURUSD. The rally, the sell off of the USD, and then the rally for the USD as it pushes back down. Here we are again down here around 1.1165 and we’re challenging that support level. All you have to do is look at it and say hey, have we seen a singular candle body open and close underneath 1.1165, and I don’t see one. We see it even challenging the black trend line with no real open and close yet underneath it.
So, again, I need a confidence booster. I don’t want this to be a false move, trying to fool some traders into going short. I want it to be a real deal move and look for that confident move underneath 1.1165. So, an open and close will give me confidence. And really it can open and close and even retest back up here into the pink zone a little bit. The worst case scenario is this. Once it gets underneath it, we don’t want it to get back above it. That’s the key point. Once it’s under it, we don’t want it to get back above it. If it does, we could see what happened back here.
It got underneath it and then got back above it. So, we don’t want it to get back above it. That’s our risk in this scenario. So, if it breaks the pink zone, we take the short. We target the green zone as our first target. Of course it could go lower all the way down here to the yellow zone at the bottom of the chart, but the green zone is our first target. But we need the breakout to sell towards the green zone. The risk then is of course above the pink zone once that happens. We want to make sure it breaks it before that though. And then we place our risk above it. We go short. We target the green zone. The risk is it gets back above it like it did back here. We wouldn’t want that to happen.
Now, we don’t know if it’s going to break yet, so we don’t want to take the short until there’s the confirmed breakout underneath the pink zone. Otherwise, a turn back higher from here if the current candle or even the next candle turns back higher from here and gets back above 1.1200, back above the pink zone, that could be the clue that the uptrend is going to resume and it’s going to go right back up to the orange-shaded area up here.
So, if you’re a seller and looking for a carry through on the USD momentum from yesterday, we need the breakout underneath 1.1165. Targets 1.1110, or even down here into the 1.1020s. Otherwise, a turn. A reversal from here back above 1.1200, may look for the return of the uptrend back towards the orange zone or higher for the EURUSD today.
From Forex Traders Daily, this has been your daily analysis with Ross Mullins. If you would like to get Ross’ analysis on all the currency pairs he’s watching and all the trades he takes today, join him in his live Trade Room by clicking on the link below. Please leave any comments you have about today’s video in the comment section below.