Blake Morrow’s Chart of The Day – Feb 3rd 2021

EURUSD

The EURUSD has great risk reward for longs while above the 1.2000 level. It seems pretty clear a break of this level would be bearish. However, the trend has been strong and higher since mid last year, and we don’t have any reason to believe that it is over yet. Technically, the 1.2000 level was the breakout point from September 2020, and the long term trend line from May 2020 to today. The risk for the bulls is the pair did close below the 1.2060 level. Some view this as a head and shoulder pattern with the 1.2060 level being the neckline. However, it is the 38% retracement of the November lows to January highs. Closing below this level is considered bearish which needs to be noted if you are playing the long side.