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.
Short-term outlook turned to become bearish towards 1.1280 (61.8% Fibonacci) then 1.1235 (78.6% Fibonacci).
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.
Currently, the price zone around 1.1235-1.1250 has turned into supply-zone to be watched for bearish rejection.
Few days ago, another recent bullish head and shoulders pattern was being demonstrated around 1.1140 on the H4 chart.
That's why, conservative traders were suggested to wait for another bullish pullback towards 1.1230-1.1250 for a valid SELL entry.
On Friday, bearish persistence below 1.1175 was needed to ensure further bearish decline. However, the market has failed to sustain bearish pressure below 1.1175.
Hence, Further bullish advancement is expected to occur towards the depicted SELL zone around 1.1235.
Trade recommendations :
Conservative traders should wait for another bullish pullback towards 1.1235 for a valid SELL entry.
S/L should be placed around 1.1275 to narrow the risk while Target levels should be located around 1.1170 and 1.1130.
The material has been provided by InstaForex Company - www.instaforex.com