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EUR/USD fell during the session on Friday again, but did get a bounce towards the end of the day to form a hammer. This hammer is sitting just below the 1.23 level, and on top of what would be the up trending line of a rising wedge. Because of this, we think the bottom of this hammer is a substantial point in this market.
We essentially have a binary trade at this point. If we break the highs of the Friday session, it is a buy signal that we could take for short-term trade. If we break the bottom of the candlestick from Friday, it would be a violation of support and we would be more than willing to sell and hold short positions in this pair.
Quite frankly, we don't like buying the Euro at all. But a break of the top of Friday's hammer does suggest a quick and 75 or 100 pips profit waiting to be had. Nonetheless, we do prefer selling this market and are hoping to see the bottom give way from Friday.