EUR/USD Consolidating around 1.33, above a Rising Trendline

Consolidation range: The 1H chart shows a EUR/USD that has been consolidating this past session around the 1.33 handle and the 200hour SMA. This consolidating also rests above a rising trendline that comes up from the 1.2990 low from mid-July. This consolidation scenario was "preferred" trading set up mentioned in the previous EUR/USD update.

Breakout scenarios: The current range is about 40 pips, so a breakout has an initial target 40 pips out of the range. A break above 1.3316 therefore first opens up 1.3356. The prevailing trend has been bullish so the break above 1.3316 should also open up the 1.34-1.3415 area with potential for a higher high.

Price action is looking down as we start the 8/13 US session. If EUR/USD breaks down 1.3275 it will also clear a rising trendline and neutralize a bullish outlook, possibly introducing a bearish one. The 40 pip projection targets 1.3235. Then the next key level will be in the 1.3185-1.32 area, which has the August low.

Pullback: Whichever side it breaks to, a subsequent pullback/throwback should stay on that side of the 1.33 handle if the break is to be extended. Otherwise, it could be a false break and we have to wait for more clues to assess direction.

The 4H chart below shows the rising trendline and teh uptrend since July.

IMOH, Clement I.
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