Let’s have a look at EUR/USD follow today’s post ECB selloff.
First of all, EUR/USD is clearly in a medium term down trend as seen in W action bias chart. Despite near term rebound from 1.1509, W action bias stayed downside red throughout.
D action bias chart turned neutral after a string of downside red bars. This is consistent with the view that price actions from 1.1509 are corrective in nature. And such corrective rise was indeed relatively weak, without any upside blue bar.
The sharp fall today turned 6H action bias downside red too, with a few persistent red bars in H action bias too.
The development suggests that EUR/USD’s down trend is possibly resuming. The main hesitation for us is that D action bias bar hasn’t turned red yet. Hence, we’d opt for a safer strategy and sell of recovery to 1.1725 minor resistance, with stop above 1.1851. We’re looking at 61.8% retracement of 1.0339 to 1.2555 at 1.1186 as target for position trading.