Tuesday, August 9, 2011
There is a monster move brewing in the Euro
I'm not a big fan of fundamentals, so if you want to know whats going on over in Europe re: the economy, then you will have to Google it. Let me know what you find out please!
The daily chart of the EUR/USD is showing a low ADX congestion pattern, and that will likely lead to a nice move when the Euro decides to break this logjam and make a directional move that lasts longer than a few days.
A crude measurement of the move right now says at least an 800 point move can occur, based on the width of the pattern, but that is obviously not in stone.
The problem with these wind downs is that usually before the breakout goes in the true direction, they will usually try to shake and bake the aggressive traders.
Nothing is easy and it's surely not red light, green light, but the low to high volatility cycle can be an extremely powerful one if traded correctly.
I have absolutely no opinion on direction, and I will keep saying that over and over, because what gets most traders into trouble is trying to guess direction from a non directional pattern.