The price reached the target from last week's analysis, where I was talking about $1.07825.
On Monday the price made a gap which took the price higher than the week had closed. The possible retrace to $1.09860 was mentioned the previous week, but the price reached only a downtrend resistance line. The bullish Pin bar on Friday was not so a strong signal to take the price to higher levels.
Tuesday was the day when the price broke below $1.08846, which was a signal the price will move to the next support level, $1.07825.
The price retraced back up to retest $1.08846 as a resistance level and from there continued moving down.
On Thursday the price reached $1.07825 support level and bounced back, but the selling pressure was too strong and pushed to close the week at the start of the demand zone around $1.07825.
Since we have a strong demand zone around $1.07825 which made the price bounce up on Thursday we could see the price making a retrace from the current support level.
We can see that Friday's candle closed below the previous three days' candle, which means the sellers are strong enough to push the price more down. But, to break strong bullish pressure on the demand zone above and below the $1.07825 support level, the seller will need to weaken the demand zone. To make that happen we should see the price staying above $1.07825 support level.
This support is also strong support from the past that I have mentioned last week. Many times the price tried to break below, but without success. So we could see the same scenario. If the price manages to break below we should wait for the retest with daily price close below this level. That will be the first step to move down to $1.06736 support level.
On the upper side price will have a hard time to break above $1.08846 resistance level because we can see three days in this week how the price could not break above.
We have a downtrend channel resistance line below $1.08846 which will pose an obstacle for the price to reach higher levels. So, we could see only a wick on the upper side without a candle closing the day above.
Since the price is in the downtrend the best scenario is to look for bearish entry opportunities. And they are around $1.08846 level where horizontal resistance level crosses with downtrend channel resistance line.
If we check the currency strength meter we can see that USD gained on strength, which suggests the price should move down more.
Video length 00:08:07
Comments
Log in or sign up to join the conversation.