EUR/USD Remains Trapped in Holiday Consolidation

EUR/USD Remains Trapped in Holiday Consolidation

Consolidation: EUR/USD had a bullish push during the 12/27 US session, which was reversed during the 12/28 Asian-European session before it can make it to 1.33. However, on the way down, the pair was supported above its previous consolidation low at 1.3157 as well, and trades around 1.3225 during the 12/28 Friday US session, smack in the middle of the range seen in the 4H chart between 1.3157 and 1.3306.

A clear consolidation range can provide a good point for direction to be developed especially if the consolidation lasts a long time. So far, we have 3 attempts that failed to clear and stay above 1.33, with 2 attempts that failed to push below the mini consolidation we had on 12/14 and 12/17.

Breakout scenarios: The break below 1.3150 can be seen as a sign of topping and suggest some short-term retracement against a bull trend that started in July from around 1.2035. Or you can say it is a correction against the latest swing from November’s low of 1.2660. In this retracement scenario, 1.30 is probably an aggressive target considering the EUR/USD had been bullish, and therefore, a break below 1.30 could be seen as a reversal.