EUR/USD: Strong Breakout, Expect Second Leg

EUR/USD
+0.07%

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EUR/USD Daily Chart

• The EUR/USD Bulls got a strong upside breakout last Friday. This was the entry bar for the wedge bull flag buy signal bar formed last Thursday.
• Last Friday’s bull breakout is strong enough to increase the odds of a 2nd leg up.
• There are likely trapped bears who sold during last Friday’s rally. Those bears got trapped during the strong rally and will probably use and pullback to exit their shorts with a smaller loss.
• The odds are that the bulls will get at least a small second leg up following last Friday’s bull breakout, even if the market has a pullback first.
• Overall, traders should expect a 2nd leg up, but be prepared for a possible pullback first.

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