Daily: The wedge is still in play, but the most interesting is that the recent low was saem by tick as the previous one. This is very rare, but we still can not be sure if it will be a perfect double bottom for short/medium term or not. The confirmation of a possible double bottom would be if Price breaks out of the bullish wedge and the triangle on the top side.
The major trend support and Senkou B (52 days avg) support is at 1,2675, this should hold evenb if we see some spiky correction again. Daily trend reversal would take place only above this level, with further confirmation with Chikou Span crossing above Price candles.
How is the momentum? Well, the bearish momentum has lost a lot. ADX stays touch above 20 level and MACD still has the positive divergence. All the longer Ichimoku components (Kijun Sen, Senkou A and B) started to point flat too, which may be an indication that the most likely scenario will be a sideaway consolidation and range trading until year end.
All in all the major trend is still bearish, but with decreasing momentum. As mkt positionning is quite short on this pair, and some players tend to square positions going into year end, something really major should happen to push it further down. Of course a very strong GDP or other supportive macros numbers could do the round, but from ECB's side more talk alone I think won't be enough.
4 Hrs: Once it looks like it can start a counter trend, next it looks like it can continue trending lower, but in fact it is stuck in a wide range 1,2355 - 1,2555. Thus we have a tightenning triangle. So instead of using Ichimoku signals (which as a trend following system is not really useful in sideaway mkts) we rather have to look at momentum indicators, and the horizontal + trend key levels for further indications. I don't prefer range trading as we get cought with too much false signals and too much stops with zero P/L, so for now I just wait for a breakout.
The major trend support and Senkou B (52 days avg) support is at 1,2675, this should hold evenb if we see some spiky correction again. Daily trend reversal would take place only above this level, with further confirmation with Chikou Span crossing above Price candles.
How is the momentum? Well, the bearish momentum has lost a lot. ADX stays touch above 20 level and MACD still has the positive divergence. All the longer Ichimoku components (Kijun Sen, Senkou A and B) started to point flat too, which may be an indication that the most likely scenario will be a sideaway consolidation and range trading until year end.
All in all the major trend is still bearish, but with decreasing momentum. As mkt positionning is quite short on this pair, and some players tend to square positions going into year end, something really major should happen to push it further down. Of course a very strong GDP or other supportive macros numbers could do the round, but from ECB's side more talk alone I think won't be enough.
4 Hrs: Once it looks like it can start a counter trend, next it looks like it can continue trending lower, but in fact it is stuck in a wide range 1,2355 - 1,2555. Thus we have a tightenning triangle. So instead of using Ichimoku signals (which as a trend following system is not really useful in sideaway mkts) we rather have to look at momentum indicators, and the horizontal + trend key levels for further indications. I don't prefer range trading as we get cought with too much false signals and too much stops with zero P/L, so for now I just wait for a breakout.
