We finally have the possibility of a short-cover rally in the Pound following an intra-day trend change that occurred overnight after bottoming on crucial support @ 1.21.
One could argue we have formed an inverted head & shoulders pattern on the 1-hour time horizon with price breaking above the neck-line at $1.22.
DXY & EUR/USD - What's The Risk
To start, I will save the macro analysis for the upcoming July report, focusing strictly on the risk and opportunities for the June 24th trading week.
Looking at the $DXY, we have now eliminated the yearly upward sloping trend-line support that helped form the rising wedge in the dollar.
With the pattern now breaking to the downside; we have to outline support/resistance to define our downside risk and where profit taking will most likely take place.
The symbolism of the Hermit Tarot Card has always inspired me.
As the hermit walks his path, the lamp lights the way forward, but only illuminating the next few steps, rather than the full journey before him. He must have the confidence to forge ahead, knowing that not everything will be revealed at once.