EUR/USD

When going through the charts I must admit, even though I had an expectation for something like this to happen, I'm still surprised. I'd like to just get some quick feedback, for instance in this post I'm showing you a lot of charts so you see for yourself, but would you rather fewer charts or just a synopsis rather than all of these charts? It takes time to capture and upload them which I don't mind doing and I know some of using 3C probably like seeing the charts as examples, but I'd just like to get an overall consensus.

 Now...

 This is the daily chart of EUR/USD, the Euro is thick with shorts and a move above this resistance line would start a strong short covering rally, probably not only in the Euro, but in stocks/market as well.

 Yesterday we tested the area 3 times and it appeared to be a failed test, I didn't specifically mention to look out for this to happen in the FX pair, I did mention it in the market, but they are so correlated I kind of assumed most would understand the same concept would apply. The uptrend line from Friday I mentioned last night, I said it's obvious to me so it's obvious to FX traders and I wouldn't be surprised to see a shakeout/break of the line, this is just typical market behavior.

 The FX pair on a 5 min chart since today's 9:30 open.

So I'm not surprised at the test of resistance yesterday and the initial failure, the same concepts about short seller sentiment on a failed test that applies to the market, applies to FX as well. I'd expect that 3C would not see too much damage as I believe the failed test was engineered to suck in more shorts as this is a classic short set up, adding more shorts (as I explained last night and many times in the past), is kind of like a primer to kick start a snowball effect on a Euro break above resistance.


 I suppose I shouldn't be too surprised as this is what I expected, but the degree to which this chart has stayed in line and un-effected by the drop in the Euro actually did surprise me. 3C is moving as the trend never broke on this 1 min chart.

 The 2 min chart trend looks very similar, there's no big negative divergence, which would be perfectly acceptable on a short term chart like this, I suppose that is what is surprising. I wouldn't expect the longer term charts to be moved much, but a negative on the 1-2 min chart would be acceptable and understandable, it's not there though.

 2 min chart close up shows the Euro positive on the 9:30 open and leading to a new high a price is lower.

 The 15 min chart shows a lot of in line trend confirmation, it is also positive at the open and leading positive currently. There was a normal negative divergence on the 6/4-6/5 pullback, but none here on a bigger move down.

 15 min chart close up is in line at the top, no negative, the open is quite positive and 3C is leading price.

 The 30 min chart needs no annotation

 The $USD 1 min negative at the top, in line on the downtrend, a slight positive in to yesterday, the gap up though is negative and in leading negative position compared to price. As I mentioned yesterday, I'd expect the Euro and $USD to look a little different with the F_E_D yesterday.

 USD 2 min negative in to the top, a positive divergence in to yesterday and the pop that it implied, but 3C won't confirm the gap up and is negative at the open.

 $USD 5 min looks as it should, the signal that is most important now is the gap up today not being confirmed and actually negative intraday.

 USD 15 min shows a small positive divergence and a negative today on the gap up with no attempt to confirm.

 $USD 30 min

Now even the $USD 60 min is changing character from a clean confirmation of the uptrend to a negative divergence starting weeks before the top and a current leading negative. The 30 min signal was strong, the 60 min is stronger. It seems to me there are two different issues, the Euro looks like a technical short squeeze, the $USD seems like there's something more fundamental going on. We'll have to look at that closer.