Blue lines- bearish channel
Nothing has changed technically over the course of the last 12 months in EURUSD. Price has formed a very clear downward sloping channel and continues making lower lows and lower highs. Over the last 12 months EURUSD has never produced a major trend reversal to the upside. Every bounce was short-lived and within the boundaries of a counter trend bounce. The weekly RSI has finally reached oversold levels and has started producing a bullish divergence this week. It is very common to see extreme headlines and panic at extreme levels and very close to important turning points. Does this mean that EURUSD is a buy? Of course not. Does it justify a strong bounce higher? Yes. Can it make a major reversal to the upside? Possibly but it is too soon to tell. Bears remain in full control in all time frames. What is certain, is that bears should not get overconfident. They should protect their profits and be cautious.
