Home EUR/USD wedge – where will it break to?
Forex News Today: Daily Trading News

EUR/USD wedge – where will it break to?

EUR/USD had a seemingly  never-ending losing streak: 6 weeks of  consecutive losses. During this time it traded under downtrend resistance.

However, after the most recent dip, the pair made some kind of correction, and this is downtrend support. So, the pair is trading in this nice triangle that is not  symmetric in the length of the lines, but the steepness is quite similar. Have a look:

EURUSD wedge February 2015 downtrend resistance uptrend support euro dollar technical trading

The fall came  monetary policy divergence: the ECB went through and announced massive QE after a long preparation, while the Fed is on course for rate hike in 2015. The Greek elections gave the pair the last nudge down, but from there we had a correction.

The lines meet on February 4th, at around 1.1330. The pair is currently just below this level, but trades at the middle of this triangle.

The normal technical behavior after such range trading choked in a wedge is a breakout. But to which direction?

The fundamentals still point to the downside in the long term, but could we see a bigger correction before a resumption of the downtrend?

More:  EUR/USD: No Defying Parity; New Targets – BNPP

Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.