The EURUSD attempted to push lower yesterday, bottomed at 1.4514 but further bearish pressure was rejected as the pair whipsawed to the upside, topped at 1.4651 and closed at 1.4627. The bias is bullish in nearest term targeting 1.4719 area but I think the situation here could be very tricky. On my h4 below I see a rising wedge formation indicating a potential warning of bearish reversal (correction). The price is now around the upper line of the bullish channel, so a downside correction is actually logic at this phase. However short positions is not recommended.
At the time I wrote this comment, the pair is traded around 1.4630 area, about 60 pips higher from my nearest support around 1.4570 area, which in my opinion is the best level to place a buy position with a very tight stop loss below the rising wedge lower line because if the rising wedge violated to the downside, the next downside correction target would be 1.4446 area. I don’t like my risk-reward ratio from here. I know the current strong bullish momentum is really tempting, but knowing the direction is never enough in forex trading. We need to be patient and consistent with our money management planning.
