EUR is a European union nation currency while USD is a USA currency. Both of them are used to initiate a transaction on a daily basis in the respective jurisdiction. On Monday the 16th of August, one EUR started trading at around 1.17900. By Tuesday the same week, the price had managed to go as low as 1.17010 but later rises to around 1.17300 on Wednesday the same week. On Thursday, the price further dropped to around 1.16720. This upwards and downwards movement is as a result of traders behaviour which can further be explained as from below;
Traders behaviour
Traders affect the way the market for EURUSD moves. When the market is moving in an upwards direction, that will be an indication that the market is in an oversold condition while when the market is moving downwards, then that will be an indication that the market is in an overbought condition. Since there is possibility of the market to be in an upwards direction, we can further explain its bullish condition as from below;
1. EURUSD bullish trend analysis
In a bullish market, the EURUSD will be moving in an upwards direction. On Monday the 16th of August, one EUR started trading at around 1.17900. By Tuesday the same week, the price had managed to go as low as 1.17010 but late rises to around 1.17300 on the same day. On Wednesday, the price went as low as 1.16960 . It later rises to around 1.17200 the same day. On Thursday, the price again dropped to around 1.16720. This market movement is being indicated as from the candlesticks chart below;
The above is the market for EURUSD. Two points are being indicated. There is A and B. Before A,the market can be seen to have moved from its highest point of 1.17900 all the way to its lowest point of 1.67600. Over there at 1.167600, the market has crossed the RSI at below 30. This is an indication of an oversold market condition over there which means that the number of traders placing their sell positions have exceeded the number of traders placing their buy positions. The market gains support over there and moves upward to point A at around 1.17500. At point A, the market can be seen to have crossed the RSI at above 70. This is an indication of an overbought condition over there which means that the buyers placing their buy positions have exceeded the sellers placing their sell positions.Because of this,the market resist to continue moving upwards but instead reversed and moves downwards at around 1.1700. At 1.1700, more sellers again enters the downwards trend in the hope of the market to continue moving downwards thus causing it to gain support and moves upward slightly at 1.17500. At 1.17500, the market again moves downward to point B at around 1.16400. At point B, the market can be seen to have crossed RSI at below 30 thus an indication of an oversold condition over there where it gains support and can be seen to have started moving upwards. If the number of sellers will continue to exceed the number of buyers, then there is possibility of the market to continue moving upwards until next week. Make sure to apply risk management and strategy well in the direction where you are holding your position so that to avoid being punished by the market.
