EUR is a currency of the european nation while USD is a currency of USA country . These currencies are used by local of each nation to conduct their daily transactions as well as by foreign to determine the pricing of different product which are then converted to their local pricing. On Monday the 17th of August, one EUR started trading at around 1.1820. The price rises to around 1.1960 on Tuesday the same week but later dropped to around 1.1830 towards the end of Wednesday. On Thursday, the price slightly rises to around 1.1870 but later further dropped to around 1.1820 on the same day. This market movement for EUR/USD is due to traders behaviour which can further be explained as from below;
Traders behaviour
EUR/USD currency pair is well stable currency due to its huge utility function thus is well tradeable by traders all other the globe. When the market for this paired currency is moving downards,that will be an indication that the buyers are more than the sellers thus causing the market to experience a downward pressure with few sellers so that it profits with them. On the other hand,when the market for this paired currency is trending upwards,that will be an indication that the sellers are more than buyers thus the market experience an upward pressure and moves upward with few buyers so that it profits with them. Having being moving upwards on Monday to wednesday, the market has started a bearish condition which can further be explained as follows;
1. EUR/USD bearish price analysis based on traders behaviour.
In a bearish market,the EUR/USD market will be moving in a downwards direction. On Monday the 17th of August, one EUR started trading at around $1.1820. On Tuesday the next day, the price managed to rise as high as 1.1960 but later dropped to around 1.1830 towards the end of Wednesday. On Thursday,the price slightly rises to around 1.1870 but later dropped to around 1.1820 on same day. This market movement is being indicated as from the candle sticks chart below;
The above is the market for EUR/USD. Two points are being indicated. There is A and B. Before A, the market can be seen to be trending in an upwards direction all the way to around 1.1960 from its previous low of around 1.1820. This upward market movement has been as a result of the number of traders holding their short positions being more than those holding their long positions. This causes the market to experience an upward market pressure and moves to 1.1960 as earlier stated . At 1.1960, there are many traders placing their long positions in the hope that the market will continue moving upwards. This causes the number of long positions to again exceed the number of short positions thus the market resist moving upwards and reverse where it starts moving downards to point A at around 1.1830. At point A, there are more traders again who are closing their long positions and beginning to open a short positions in the hope that the market will continue moving downwards. This causes the market to resist moving downwards and slightly gain support where it moves upward to point B at 1.1870. More traders are again beginning to place their long positions in the hope that the market will continue moving upwards. This again causes the bought positions to exceed the sold positions thus causing the market to resist moving upwards but instead reverse and moves downard to below 1.1830. If the buyers will continue exceeding the sellers,then there is possibility of the market to continue moving downwards to around 1.1720. You can continue holding your sell position until monday next week in order to collect more profits. Make sure to apply your strategy and risk management well because the market can sometimes go against you.
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