Potential new downside trend ahead
Updated
EURUSD has been trading within an ascending channel, indicating a consistent upward trend. However, recent price action has revealed a concerning development, suggesting a potential shift in momentum. A bearish divergence has emerged, reflecting a weakening uptrend and raising caution among traders.
Bearish divergences occur when the price reaches higher highs while the corresponding technical indicator, such as the Relative Strength Index (RSI), fails to achieve higher highs, signaling a potential reversal. This divergence indicates a loss of buying strength and hints at a possible downward correction.
The current scenario presents an opportunity for us to consider a bearish breakout scenario, with the price poised to break out of the ascending channel and initiate a new downtrend. This breakout could signal a shift in market sentiment and attract increased selling pressure.
Should the breakout occur, three potential downside targets come into focus. The first target is projected at 1.0863, which marks an initial support level. A decisive breach below this level could lead to further downside momentum, targeting the second support level at 1.0814. Finally, the third and final target lies at 1.0746, representing a significant support zone where a potential rebound or reversal might occur.
Bearish divergences occur when the price reaches higher highs while the corresponding technical indicator, such as the Relative Strength Index (RSI), fails to achieve higher highs, signaling a potential reversal. This divergence indicates a loss of buying strength and hints at a possible downward correction.
The current scenario presents an opportunity for us to consider a bearish breakout scenario, with the price poised to break out of the ascending channel and initiate a new downtrend. This breakout could signal a shift in market sentiment and attract increased selling pressure.
Should the breakout occur, three potential downside targets come into focus. The first target is projected at 1.0863, which marks an initial support level. A decisive breach below this level could lead to further downside momentum, targeting the second support level at 1.0814. Finally, the third and final target lies at 1.0746, representing a significant support zone where a potential rebound or reversal might occur.
Note
Price failed to create a new high. The trade is still active and the current price is still interesting if you were late on the idea.Note
Channel is broken to the downsideNote
New lower low...Trade closed manually
Closing this position at entry point. Price action is too flat, it is lacking momentum to go downTrade active
Re entered a sell at 1.0919 with same sl and TP'sOrder cancelled
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