A reversal downward pattern was formed yesterday. This makes it possible today to look for sales at competitive prices. It is necessary to take into account that today operations are taking place on the open market, which may be the starting point for the formation of a medium-term model.
For two weeks, there is the formation of the medium-term zone of accumulation. This indicates the significance of weekly extremes. They must be used as support and resistance levels. Yesterday's closing of the American session occurred below the 1/2 control zone of 1.1350-1.1341, which shows a priority change and continuous fall becomes more likely. The purpose of the bear model is the weekly CZ of 1.1258-1.1240 Sales from current rates are possible but gives low profits. The first resistance is a CZ at 1.1356-1.1352. The test of this zone will allow getting favorable prices for sale.
The determining resistance is the a CZ at 1.1407-1.1398. As long as the pair is trading below this zone, the downward movement will remain a priority. Growth to the current zone will provide the most favorable prices for the sale but today, the zone is outside the daily average.
When maintaining a short position, it is necessary to take into account the fact that the average weekly move will take place on the way to decline. This range is closer to the price than the weekly fault, which may prevent the priority model from being implemented within the current week. Its execution may require a transfer to the following Monday. When the pair reaches the average weekly move, it is possible to fix a part of sales, as demand is expected to grow.
Daily CZ - daily control zone. The area formed by important data from the futures market that change several times a year.
Weekly fault - weekly control zone. The area formed by marks from important futures market which change several times a year.
Monthly fault - monthly control zone. The area is a reflection of the average volatility over the past year.
The material has been provided by InstaForex Company - www.instaforex.com