Hi Traders! EURUSD forecast follow up and update is here. On August 31st I shared this “Technical Analysis – EURUSD Forecast” post in our blog. In this post, let’s do a recap of this setup and see how it has developed now. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club. Spoiler alert – free memberships are available!
My Idea
On the H4 chart, we have a bullish divergence that has formed between the first low that has formed on 11th August 2021 and the second low that has formed on 20th August 2021 based on the MACD indicator which we may consider as another evidence of bullish pressure. Then the price moved higher and broke above the last high at 1.18045 which we may consider as yet another evidence of bullish pressure. Until the three support zones (marked in blue) holds my view remains bullish here and I expect the price to move higher further.
EURUSD H4(4 Hours) Chart Current Scenario
Based on the above-mentioned analysis my view was bullish here and I was expecting the price to move higher further until the three strong support zones hold. The price action followed my analysis here exactly as I expected it to. After the breakout above the last high at 1.18045, we had a pullback and the price which was moving lower reached the first strong support zone, respected it and bounced higher from this zone. The price then moved higher further and delivered around 80 pips move so far.
On the M15 chart, the market provided us with various facts supporting the bullish view. The price which was moving lower created a bullish divergence between the first low that has formed at 1.17963 and the second low that has formed at 1.17934 based on the MACD indicator. The price then moved higher and broke above the most recent downtrend line, we may consider these as facts provided by the market supporting the bullish view. Then as you can see in the image below how the price moved higher after that and provided a nice move to the upside.
(Note: You can learn about a Killer Forex Strategy “Double Trend Line Principle” here)
As traders we always have two choices, the first one is to fall in love with our analysis and try to convince the market and expect the price to move in the direction as per our wish. The second one is to follow the facts that the market provides us and make the right actions according to that. As you know the first option won’t help us and as you can see in the example above what happened when we followed the facts that the market hinted us and took the right action according to that.
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If you have any further questions, don’t hesitate to drop a comment below!
To your success,
Vladimir Ribakov
Certified Financial Technician
