The EURUSD has fired off a false break pin bar on the daily price action chart. During the session price moved lower and through the recent key support level, which would have got the a lot of the market going short, with breakout traders looking for the market to breakout lower. The market has then snapped back higher and created the false break pin bar as shown on the daily chart below, with the nose on the pin bar protruding through and making a false break of the recent support level.
The major worry for price moving higher on the back of this pin bar is that price has been super choppy and trading in a heavy sideways market of late and when price has been in such an undecided market it tends to create a lot of minor support and resistance levels. If price confirms the pin bar by breaking the pin bar high, there is then some close overhead resistance levels that price will have to deal with if it is to make any substantial moves higher. The first levels of concern comes in around 1.3745 and then 1.3770 and if price can gain momentum and cut through these levels, then price may be able to make a powerful move back higher, but these levels first need to be broken solidly.
EURUSD Daily Chart
Hi Johnathon, I would like to ask about the minor resistance (a.k.a. bad traffic).How much do we need to scroll the chart to take the traffic into our consideration before taking a trade?
Hello Fazily,
it depends on the chart and the price action. There is not one answer for this question, but what you will often find is the same levels will repeat over and over again or in other words the levels from previous years will repeat again and be respected. in this day and age. If you look at the major levels on the EURUSD chart, they line up with the same levels going back years ago.
Johnathon