EUR/USD underlying cloud support holds on daily
The EURUSD has been consolidating sideways since the beginning of August (dashed red rectangle). This has largely coincided with the slowdown in the rate of change of the US M2 money supply. Ichimoku is trend following and if the EURUSD continues to consolidate we will expect whipsaw signals. We do note that today’s candle (still to complete) is a hammer (blue arrow). I.e. bears have lost control at the day’s low and bulls are now in charge. This also happened at cloud support. The fact that the black base line is still trending up does suggest that the underlying momentum still has an upwards bias.
To this end, we are watching to see if:
-
The orange lagging line moves convincingly back above the candles.
-
If the price moves back above the black base line.
If these do happen, it will be regarded as bullish developments for the EURUSD pair.
Past performance is not an indicator of future results
CHART SOURCE: FXCM Marketscope 2.0
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.