Thursday February 6, 2020 - 16:13:39 GMT
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Forex View: What's Next? EURUSD January Low Taken Out.
When we left off last week it looked like the EURUSD was focused on the January high at 1.1225. However, with the risk pendulum swinging back to on from off, positions taken towards the end of last week have been squeezed out.
In my article, Has the EURUSD Set its Low or High for the Year?, I debunked the theory that the EURUSD low or high for the tear is set in January but did mention that there is a pattern where it has been occurring in alternate years. Since the EURUSD 2019 high for the year was set in January, a continuation of this pattern would suggest that neither the low nor high would be set during 2020.
Well, the January low was just taken out on Thursday, February 6, which leaves only the high set in January at 1.1225 intact.
What does this imply?
By itself, it means little except for those who believe in the January Effect despite evidence to the contrary will take it as a bearish sign, especially those in the consensus who came into the year with a bearish dollar/bullish EURUSD view.
I, personally, will put the 1.1225 level on the backburner but will keep it in mind as the year progresses given the January low/high alternate year pattern should the dollar reverse direction.
In the meantime, I personally will continue to let the Amazing Trader and its Ladder Strategy guide me, where EURUSD 1.0980 (just broken as I type) is the next key level guarding 1.1940 and 1.0878.
I try not to make my articles promotional articles for our Amazing Trader and the AT Ladder Strategy but as you can see by this 4 hour chart, following its logic would have had you trading on the right side with a strategy to taken advantage of it. For those interested, send me an email at [email protected] and as about our current promotions.
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