I am going to try something here: buy stop @ 1.20707 targeting 12 pips profit, can't say exactly why but it just feels right ... it's the level of the downbar of the evening star is the best I can come up with ... some bears will probably have put their stop there so that might lite things a bit up ...
if my buy stop doesn't get hit within the next hour I might look for something else to go long again.
after years of staring at charts you develop some kinda gut feel for charts ... but HOWEVER it's really really important that you can back that 'feel' up with something 'objective' or that 'feel' might turn on you really hard ... I gues my feeling was backed up by my explanation ... we 'could' however be once again trying to build an inside bar on the hourly here, so I might take the top at the next hour ... if the trade doesn't emerge by then I will be off to the dentist.
a nice example of gutfeel was the fact that I 'knew' gold was really bullish because of the force which which it had turned from the recent low ... only later I saw it was a daily key-reversal with weekly oversold with stochastics forming a hidden divergence on the weekly ... I see gold going to at least 1394 USD and advised friends to buy some gold at the start of this new year. The entry price was 1303.75 USD a few hours later and gold is allready almost 10 USD in the positive side.
Putting gut feel aside. What can you tell me about EUR/USD that is factual? What I mean by this is that whoever you ask on planet earth, they will all give you the exact same answer.
Well what can I say about euro you most likely mean since we previously had a good explanation about USD weakness. Why would I think euro might be strong in the near future: the economy is improving here and Europe will probably stop their QE. If the economy grows stronger inflationary worries might pick up and the ECB might resort to their first short term increase in years. I know this might sound all a bit hypothetical for the near future but markets tend to discount things.
the 1H inside bar point has become moot here but it could still produce a key-engulfer with the trend here on the hourly.
One thing that hasn't been mentioned here is the fact that Trump might actually like a weak dollar since that's good for export + prices of foreign goods will be more expensive ... all in the spirit of 'making America great again' ...
Very nice! Okay, so what should you give more attention to: Eurozone member states inflation/core inflation and ECB or your technical system? What is likely to drive EUR pricing forward out of the two above? No, this is exactly how you do it! Do not underestimate this! You run scenarios! The market is always trying to 'price in'. At times the market gets it wrong or misses and then they will have to 'reprice'. What you're trying to assess is where the greater probability for price movement is, on a forward basis. What I mean by this for example is, for every 1 tick down it will be met with 3 ticks up on average because of x, y and/or z. Or, for every 1 tick up it will be met with 3 ticks down on average because of x, y and/or z. Below is a graph of EUR FX futures market through 2017. Note how the market has been 'Net long' since March. It has actually been trending higher all year! The chart above is only data, that is all it is. It is most certainly not the 'Holy Grail'! If you can find out what is driving the data, then you can trade forward.