The EURUSD forex market has been in a trading range since Nov. 17. There is both a lower high and a higher low, and you could call this a triangle.
That does not change things because the trading range alone is a Breakout Mode pattern. That means there is a 50% chance of a successful bull breakout, a 50% chance of a successful bear breakout, and a 50% chance that the first breakout up or down will fail.
I have been saying that because the EUR/USD has been in a trading range for 7 years, the odds of more reversals are greater than those of a breakout of the 7-year range.
The current leg down has lasted a year. While it could last longer, it will probably reverse up for at least a couple months before breaking below last year’s low and the 2017 low at the bottom of the 7-year range.
The bulls want this triangle to be a base and the start of a rally up to the Nov. 9 high, which is the start of the most recent leg down and therefore a magnet.
If there is a bear breakout, the 3-week trading range is a good candidate for a final bear flag. That means there is an increased chance of a reversal up from around a measured move down below the 3-week range.
Currencies have a tendency to reverse around the first of the year. That increases the chance of a breakout above the 3-week triangle soon or of a reversal up after a bear breakout.
Since the bear trend has been strong on the daily and weekly charts (it is just a pullback to the middle of the 7-year range on the monthly chart), the odds always continue to favor at least slightly lower prices.
However, because of what I wrote above, traders should be aware that a 2-month reversal up can start at any time