Is the EUR/USD Running Out of Steam?

Trending patterns like the Continuation Rising Wedge on the 240-minute EUR/USD are powerful patterns for both trend following set up and reversal. The interesting point at which this pattern is sitting is near the uptrend line support and the major psychological level of 1.3300.






The quality of the pattern is high with excellent Clarity and Uniformity readings, however, note that the Initial Trend is comparatively lower. This low reading is possibly because of a stall and/or reversal. The break of the support line would accompany the break of the 1.3300 level, which would be a significant shift in psychology. The short trigger would come as price pierces the uptrend line; however remember there are two stories to all trending patterns.



The other scenario would be support at the same 1.3300 level. Support would create a bounce and trigger a corrective entry long off this level, as well as a trend following play as the trend is still slightly up in the EUR/USD. This would mean that the short trade would be a confirmation of both a shift in trend and a failure of support at the 1.3300. Again the low Initial Trend reading means that the trend is slowing and this could also shift the market cycle from up to sideways.

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