Above is the daily EURUSD chart. We can see it's done nothing for three days and failed to reach any higher. But also, prices have sat right on that top Bollinger band. Many other analysts from other sites were calling for higher EURUSD, but I figured it wouldn't be able to move higher until the pressure was off that top band. If it is going to move higher, it now has room to do so.
Above is the daily EURGBP chart. One of the first things I noticed last night was this started to move rapidly downwards. I thought that was interesting.
Above is the USDCAD daily chart. It started moving rapidly downwards last night also. If it had started moving upwards instead, I would have assumed increasing USD value, and in conjunction with the falling EUR as shown on the EURGBP chart, may have felt tempted to start selling EURUSD.
Above is the daily AUDUSD chart. Last night it, in conjunction with several other currency pairs (not shown) starting marching upwards. This was very strange, I thought. However by the end of the night, it had dropped again. We can see that AUDUSD looks to be in consolidation, and the Bollinger bands are tightening up. The USDCAD chart shows something similar, except it tried to escape it's bands last night but failed.
Aren't charts fun?! Here's a few more:
This is the daily EURUSD with 100 and 200 simple moving averages plotted. We can see the price accelerated through the 100 (red) line, stalled, and dropped, coming to rest slightly above it. We could take this as a sign of support, and in conjunction with the pressure having dropped from the top Bollinger band, a sign of a coming move upwards.
But now the 60 minute EURUSD chart. The price has fallen through the 100 simple moving average and closed slightly below the 200 as well, thus establishing resistance, at least on this 60 minute time frame.
Exciting!
So what does all this mean, and where is the EURUSD going?
There is an upward trend in the EURUSD, and despite the resistance offered by the 200 simple moving average on the hourly chart, price is supported by the 100 simple moving average on the daily chart and there's now room for price to continue upwards according to the daily Bollinger band study. Additionally, several others sites are calling for more upwards movement in EURUSD.
Last night was the end of the month, and I remember hearing about some payment between Great Britain and the European Union, which might account for the large EURGBP movement seen last night, and possibly even the movement in EURUSD.
Several other currency pairs are not moving how I'd expect them to from a EURUSD fall, but also the consolidation on AUDUSD, NZDUSD, and USDCAD give me reason to pause.
It seems like something big is about to happen, but I'm not sure of the direction.
Luckily, none of this matters too much, because I'm demo trading a break-out system which looks for consolidation and places straddle trades around it.
Here is a 5 min EURUSD chart showing a fairly nice consolidation pattern (highlighted in yellow). Additionally the Bollinger bands have pulled in nice and tight. I'll go ahead and place pending BUY & SELL STOP orders at the top and bottom of this rectangle and see what happens tonight.
Since this is the 5 minute time frame and the range of the consolidation pattern isn't very big, I'd not be expecting very big profits if a breakout was to occur.
I'm sure there's a lot more technical information I could have found, but this will do for the moment.
