Since January 10, the EURUSD pair has been moving within the depicted channel with slight bearish tendency.
Few weeks ago, a bullish Head and Shoulders reversal pattern was demonstrated around 1.1200.
This enhanced further bullish advancement towards 1.1300-1.1315 (supply zone) where significant bearish rejection was demonstrated on April 15.
For Intraday traders, the price zone around 1.1235 (78.6% Fibonacci) stood as a temporary demand area which paused the ongoing bearish momentum for a while before bearish breakdown could be executed on April 23.
Short-term outlook turned to become bearish towards 1.1175 (a previous weekly bottom which has been holding prices above for a while)
On May 17-20, a bearish breakdown below 1.1175 was temporarily achieved.
As expected, further bearish decline was expected towards 1.1115. This is where significant bullish recovery was demonstrated by the end of last Thursday's consolidations bringing the EURUSD pair back above 1.1175.
Recently, The EURUSD pair was trapped between the depicted price zones (1.1150-1.1235) until Tuesday when another bearish breakdown was demonstrated below 1.1150.
This should enhance the bearish side of the market towards 1.1115. However, conservative traders should stay out of the market until long-term outlook is determined.
Trade recommendations :
Intraday traders should look for another bullish breakout above 1.1175 as a valid BUY signal.
T/P level to be located around 1.1240. Stop loss should be placed below 1.1150.
The material has been provided by InstaForex Company - www.instaforex.com