The pair moved lower after breaking below major demand levels around 1.2100 and 1.2000 where historical bottoms were previously established back in July 2012 and June 2010.
EUR/USD bears have already pushed the price slightly below the monthly demand level of 1.0550 (established in January 1997). Bullish recovery was observed shortly after.
April's candlestick came as bullish engulfing one. However, the next monthly candlesticks (May, June, July, and August) reflected the recent bearish rejection, which exists around the level of 1.1450.
In the long term, a projected target is still seen at 0.9450 if a bearish breakdown at the monthly demand level of 1.0550 occurs soon (low probability).
On the other hand, a bullish corrective movement towards 1.1500 and 1.1700 can take place only if the weekly high of 1.1465 gets hit as soon as possible.
This can be achieved if the current monthly candlestick closes above the weekly high of 1.1465 by the end of this month.
Multiple ascending bottoms were established around the levels of 1.0830 and 1.1020. These levels corresponded to a current daily uptrend depicted on the chart.
Shortly after, the market looked overbought as bulls were pushing the price further beyond the level of 1.1500 (daily supply level).
Hence, a bearish movement towards the level of 1.1150 (61.8% Fibonacci level) took place providing evident bullish rejections several times in a row.
Previously, the intraday supply zone of 1.1360-1.1400 provided significant bearish rejection. An intraday sell entry was suggested with T/P levels placed at 1.1150 (achieved) and 1.1050. The latter was not reached as the level of 1.1150 prevented further bearish decline.
Daily persistence below the level of 1.1150 (61.8% Fibonacci level) was needed to expose the next demand level around 1.0980 where the daily uptrend comes to meet the EUR/USD pair.
However, bullish rejection was expressed around the level of 1.1150, which led to another bullish pullback towards the intraday sell zone of 1.1370-1.1400.
As anticipated, it offered a valid sell entry as long as the market keeps defending the EUR/USD supply zone at 1.1450-1.1500. T/P levels should be located at 1.1333, 1.1250, and 1.1150.
On the other hand, conservative traders should wait for a bearish correction towards the zone of 1.0980-1.1000 (the depicted uptrend line) for a low-risk buy entry. S/L should be placed below 1.0950. T/P levels should be placed at 1.1080 and 1.1160.
The material has been provided by InstaForex Company - www.instaforex.com