Will EURUSD Hold Above 1.2000?

Expect my blog over the coming days and weeks to be far more focused on FX than it has been since I started this blog at the end of last year. And that is simply because the FX market is showing signs of life that interest me as a trend trader. Stocks have been and continue to look interesting as they have been trending very well since last year whilst FX has been in a lull trading in a prolonged period of consolidation.

This has been setting up for sometime now but it looks as if market conditions are changing as entry points into emerging trends maybe presenting themselves in FX.

I last posted on the EURUSD back on July 30th when price was directly below the weekly 200sma which was acting as immediate resistance. I mentioned on that post that this is not an environment to be taking short trades by having a very simplistic approach of going short off resistance. This is a short-lived approach that delivers little to no profit.

Instead, the smart approach was to apply patience and wait for price to break through the weekly 200sma and the round number 1.2000 directly above.

Looking at the weekly timeframe above, we can see that our patience is being rewarded with price trading above the weekly 200sma. Price is currently also trading above the round number 1.2000 which we can see in more detail on the daily timeframe below.

A break through these key resistance levels was always more likely than a reversal given that price had bullish momentum to it since April. We simply needed to apply patience and let price dictate the break through.

There are many reasons why such a vast number of private traders fail but one of those reasons is failing to understand the importance of patience to allow for high-probability environments to present themselves.

Many private traders have little idea of market conditions, which is a flaw of day trading, and tend to chase money by trying to predict what price may do next.

Letting price dictate and then going in the direction of the established trend is a far simpler, far more consistent and far more profitable approach. It will also not lead to stress and burnout like many experience.

With regards to the EURUSD, I am now still standing aside until price establishes a trend above 1.2000 in order to avoid a fake breakout. I will then like to see price move towards 1.5000 and beyond.

The trend is your friend and FX is now looking very interesting to make friends with.

Any comments and questions, do not hesitate to leave them below.

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