Daily timeframe
Contents
EURUSD reversed from the strong area of resistance last week even before reaching the 1.14 level and it even went off to break the small 1-month channel last Friday. Looking for opportunities to sell the pair is absolutely a valid strategy at the moment because we have clear bearish signals across multiple timeframes.
The main question now is will we get a follow-through price action to the downside. You should be aware that this will be fundamentally decided, specifically a crucial Non-Farm Payroll report is scheduled for this Friday and traders should be well aware of it.
EURUSD Daily chart – Bearish signs finally emerging!
4h timeframe
The pair is now inside of a Fibonacci convergence support zone between 1.1165 and 1.1202 (shown on the chart in blue and purple are the Fib levels and the starting points of the swings from which we measured the retracements). So, it may be best to wait for a small retracement instead of rushing to enter short. Additionally, the weekly pivot point is above the current price so there are good chances that a retracement will indeed happen.
A very good area to sell will be the area from the weekly pivot point (1.1140) to the monthly resistance 1 (1.1162). Somewhere inside or close to this area will be the support trendline of the broken channel shown on this 4h chart.
The monthly pivot point at 1.11 to the downside is support.
If EURUSD for some reason moves higher than the area we defined above then this bearish trade will be voided.
EURUSD 4h chart – Attractive short opportunities ahead!
Weekly timeframe review
Lastly, let’s briefly review the larger technical picture. With the last week’s close a bearish dark cloud cover formation was completed, right at the retest of the long term, 7-8 months old channel we have so extensively discussed in many of our previous weekly analyses.
This dark cloud cover pattern and the over weekly technical picture signals a move to at least 1.09 unless price moves and closes above the high of the formation.
EURUSD weekly chart – Bearish signal at resistance!
Our Recommended Binary Options Brokers to trade EURUSD:
Best Regulated Broker
IQ Option is the world’s leading EU regulated broker based with a revolutionary platform for all traders. Read IQ Option Review
- Best Trading App for Binary Options
- Minimum Deposit of only $10
- Minimum Trade of $1
- Trusted Broker
- $10,000 Virtual Funds ( Demo Account )
- Quick Withdrawals
- Outstanding Platform
- Weekly Tournaments
- Gain up to 98%*
Best US Broker
- They accept US clients
- 1-Hour Withdrawal
- Paypal & AMEX Accepted
- $1 Minimum Trade
- Huge Bonuses
- Highest Returns
- Weekend Trading
- Free Education
I've been a professional trader for over 5 years.
Currently I work as forex analyst for different investment companies.
- EURUSDWeekly outlook – 7th January 2022 - January 7, 2022
- BTCUSD – Weekly outlook for Bitcoin Price – 23rd December 2021 - December 24, 2021
- USDSGDWeekly outlook for Singapore Dollar – 17th Dec 2021 - December 17, 2021
Tagged with: EUR/USD
