FX.co ★ Farhan Ali Shakir | EUR/USD

For EUR/USD in the previous session, the market witnessed a brief upward correction, followed by a robust southward drive. This resulted in the formation of a complete bearish candle, consolidating close to the prior day’s low, refreshing it. Given the current scenario, I expect the potential for further southward pressure on the price. In such a case, we will focus my attention on the support level at 1.04482. Around this support level, two likely scenarios emerge. The first entails a consolidation beneath this level and a continuation of the southward momentum. If this unfolds, I’ll be poised for a potential move towards the support at 1.02902. It is in proximity to this support level that I’ll be on the lookout for the development of a trading setup, which will aid in charting the subsequent course of action. While I acknowledge the potential for a further push southward towards the support at 1.00937, the situation warrants a careful assessment, and much hinges on the forthcoming news backdrop. An alternate scenario upon nearing the 1.04482 support involves the emergence of a reversal candle, followed by an upward resurgence. Should this materialize, my strategy would entail expecting a rebound to the resistance levels at 1.06396 or 1.07679. Near these resistance levels, my focus will remain attuned to identifying potential bearish signals in anticipation of a renewed downward trajectory. In summary, my immediate outlook envisions a continuation of the southward journey, culminating at the nearest support level, after which my course of action will be contingent upon the unfolding trading landscape.

The bulls seemed to have lost their vigor right from the outset. Their capacity to propel an upward wave appears to have dwindled. Perhaps revisiting the lows can rectify the situation. However, I must admit, my confidence wavers. I started a modest sell-off this morning. While the ideal strategy should be to await a breach after a contraction, only then will the signal be reinforced, permitting a more assured selling approach. Let’s observe if my assumptions hold true or if the market employs its usual stratagems. To begin, let EURUSD dip to its lows, finding out whether they can breach further or if a rebound will once again ensue. Did you conclude your purchase yesterday, or do you plan to persevere with it? Failure to sustain the minimums might precipitate a substantial downturn. Figures of three or four could surface, with rebounds. The potential here is considerable, even with temporary recoveries.