EUR/USD: It happens over and over again 📈
Hi traders, I've been busy with trading and didn't have much time to upload new ideas. Sorry for that, here comes a short educational post.
Trading isn't complicated, but it's complex. Certain patterns appear over and over again, and our job is to take advantage of them.
Here is an example in EUR/USD. The pair broke above a major resistance level on the daily chart after Eurozone PMIs beat expectations this morning.
The strong bullish candle means that large players didn't have time to accumulate euros at favorable prices. So what do they do? They drain liquidity (manipulate the market) to buy euros cheaper.
Sell-side (banks) need euros in their warehouse to satisfy the demand of the buy-side (hedge funds).
And for banks to make money, they need to buy euros cheaper, which is why most large candles are immediately followed by a pullback.
Of course, this only works if fundamentals support the direction. In this case, EUR PMI numbers and broad USD weakness ahead of the FOMC means one thing: High-possibility of further strength in EUR/USD.
Thanks for reading and stay tuned for more posts! Please hit the "LIKE" button and follow if you haven't already.
Trading isn't complicated, but it's complex. Certain patterns appear over and over again, and our job is to take advantage of them.
Here is an example in EUR/USD. The pair broke above a major resistance level on the daily chart after Eurozone PMIs beat expectations this morning.
The strong bullish candle means that large players didn't have time to accumulate euros at favorable prices. So what do they do? They drain liquidity (manipulate the market) to buy euros cheaper.
Sell-side (banks) need euros in their warehouse to satisfy the demand of the buy-side (hedge funds).
And for banks to make money, they need to buy euros cheaper, which is why most large candles are immediately followed by a pullback.
Of course, this only works if fundamentals support the direction. In this case, EUR PMI numbers and broad USD weakness ahead of the FOMC means one thing: High-possibility of further strength in EUR/USD.
Thanks for reading and stay tuned for more posts! Please hit the "LIKE" button and follow if you haven't already.
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