Forex Strategy: EUR/USD Piercing Line Pattern Plays Out
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- EUR/USD Technical Strategy: Shorts pending on bearish reversal candlestick formation
- Recent Piercing Line candlestick pattern resulted in 5 straight days of gains
- Overhanging resistance at 1.3700 may cap further gains and present selling opportunity
The recent Piercing Line candlestick formation has continued to result in further gains for EUR/USD. The absence of a bearish reversal pattern leaves a bullish bias for the pair. However, resistance looming overhead at the 1.3700 handle may leave further upside potential for the Euro limited.
The risk to reward on new long positions at current prices is off and suggests waiting on the sidelines may be a safer alternative. Additionally with sellers likely sitting at the psychologically significant 1.3700 handle, a selling opportunity may arise if a bearish reversal candlestick pattern presents itself.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by David de Ferranti, Market Analyst, FXCM
Contact and follow David on Twitter: @Davidde
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