These moves are coming mostly from a surging EXY ( Euro Index) which matches closely with the current upward trend of the EURUSD . It is aided by a declining DXY (USD index), which has been amplifying the move.
The next few days will be critical. Pay attention to the WAY in which this trend develops. From around 1.175, the EURUSD could produce a top.
IF a top is created around 1.18:
1. Analyze the nature of the pullback. If it whipsaws with vengeance, than the downtrend may be more serious. Should it cross back below 1.155, we may see a decline of around 500 pips from the top, taking us back to 1.12 before rallying again.
If instead the pullback is more gradual, and begrudgingly shedding points, we may be building pressure for yet another rally. A decline of perhaps 200 pips, back to around 1.155, could produce a bottom and send us to higher levels.
-There may be no pullback at all. EU could continue right through 1.175 and continue north.
Pay attention to the beginning of next week, around the 23rd of July, as well as the 1st of August and 8th or 9th of august, for these events to take place.
Afterward, the EU may produce an initial top around 1.23, but an eventual continuation to around 1.255 or 1.26 even is possible.
Other than the dates within the next two weeks, it is entirely uncertain how long these events will take to occur, but it may happen quicker than you think. The Euro is moving north with vengeance.
The 2nd scenario was the one that has taken shape at this point. We did get a small top around the 1.18 zone, although the market came closer to 1.19. And this occurred in the morning of August 2nd at 2am (still influenced by August 1st important date.)
The market has now begrudgingly shed 220 pips, and found a bottom on the 9nth of August.
This is the best scenario we could have gotten. It gave us a serious but modest pullback in the way we desired, and on the dates we desired as well.
I am long the market vs the recent bottoms.