Today on EURUSD – NFP Rules.

Pls NOTE: If there’s one particular day in every month that trending method/pattern traders should be wary of trading most, it has to be the first Fridays of every month when the Non-Farm Payroll (NFP) report is usually released. Early market hours are usually dull; afterward, usually around the news release, we have extreme volatility, which disrupts any recognizable chart patterns; hence, the entire trading day becomes virtually un-tradable. At least, that has been my personal experience. While I’ll go ahead to give my personal analysis on the EURUSD pair, please, let’s bear in mind that, regardless of any technical analyses, NFP usually rules today.

On the Daily chart above, yesterday, after two days of indecision (as shown by previous “dojis”) price broke previous days’ lows (Tuesday and Wednesday’s lows) downward. In addition, the price reversal happened around the upper edge of what I believe is referred to as a rising wedge pattern. To me, these signal the possibility of further price movement downward.

On the H4 chart above, price has broken the most recent swing low @ 1.4355 (which we’ve highlighted using the blue broken line) downward. This automatically shifts our bias in favor of a downward price move. The white horizontal line @ 1.1.4447 highlights the most recent swing high, and as long as price stays below it – in the absence of any new and lower swing high – our bearish or downward bias remains intact.

However, we still need our Hourly charts – using Fibonacci retracement levels and important resistance levels – to seek promising areas to take our Short positions. Price pattern on the Hourly must also be forming lower highs and lower lows. Please note that our aim is to sell a rally in today’s down-trend.

Also, PATIENCE is the key here: we need to patiently wait for the Hourly retracement. It might happen, and it might not.