Risk of Judas or CAPS Formation Amid Market Compression
The EUR/USD chart suggests a potential phase of market compression (CP), where price action is confined within a narrow range, often signaling an impending significant move.
Key elements in the analysis:
H4 FVG (Fair Value Gap): This zone could act as resistance, where liquidity is accumulating, possibly leading to a price reaction.
M15 FVG: A support area where buyers may look to enter the market.
Protected Order Block: A critical level defended by institutional orders, likely to cause a bounce if tested.
Liquidity: Various points where sharp moves could occur as market makers target these areas.
There's a possibility of Judas or CAPS base formation, indicating a potential false breakout before a sharp reversal, which could trap traders who enter based on the initial move.
Overall, the market structure appears bullish, with expectations for upward continuation if the compression resolves to the upside. However, caution is advised due to the risk of sudden and sharp movements.
Key elements in the analysis:
H4 FVG (Fair Value Gap): This zone could act as resistance, where liquidity is accumulating, possibly leading to a price reaction.
M15 FVG: A support area where buyers may look to enter the market.
Protected Order Block: A critical level defended by institutional orders, likely to cause a bounce if tested.
Liquidity: Various points where sharp moves could occur as market makers target these areas.
There's a possibility of Judas or CAPS base formation, indicating a potential false breakout before a sharp reversal, which could trap traders who enter based on the initial move.
Overall, the market structure appears bullish, with expectations for upward continuation if the compression resolves to the upside. However, caution is advised due to the risk of sudden and sharp movements.
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