EUR/USD: We can expect quite a few sessions of consolidation

The market got caught short in illiquid conditions and that will give the bears some food for thought in coming sessions. A daily close back above the previous 1.2350 support level would also weaken the bears argument. The bearish trend is strong but nothing moves in a straight line in the FX market.

If I were short, I’d certainly now be looking to buy dips back towards 1.2300. On the other hand if I were long, or looking to enter a short position, I’d be looking for rallies to 1.2550 to sell into.

That sounds to me like a good recipe for consolidative range trading over coming sessions and days

  1. I took a long this afternoon (U.S. central) on NZDUSD, 4H/Daily has a potential H&S forming. Small one, stop at .7650 … letting it ride into 2015. EURUSD has a nice wedge on daily, I have a pending long at 1.2460 & 1.23, letting those ride too. I love the US, but not convinced that everything is as peachy as it is made to be, a lot of credit cards being used …

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