- EUR/USD is trading just above flat as GBP takes the limelight.
- There is a massive consolidation forming on the 4-hour chart.
EUR/USD 4-hour chart
EUR/USD has to play second fiddle to GBP when it came to the big news today. The battle came between who would outperform against the pound EUR or the USD. In any case, the EUR slightly edged that battle and trades 0.08% higher. We are stuck between a rock and a hard place at the moment with both the Fed and ECB as both are not budging.
Looking at the chart the fight between the bulls and bears is clear. They are currently at gridlock between 1.20 and 1.17. As ECB members spoke about the EUR being overvalued and too high it looked like the price could fall but a test of 1.1737 was all the bears could manage. From a traders perspective, I would avoid this one like the plague. At least until the consolidation breaks but having said that, a range trading strategy could do well.
The indicators are both meandering in the mid-zone. The Relative Strength Index is at the 50 mark and the MACD histogram is near the midpoint. The signal lines are also stick in the middle but slightly below the mid-area.
Overall on the higher timeframes, this could still be considered as an uptrend. For the trend to continue however the black line at 1.20 would need to be broken and a break of the green mean value are would be a great start.