The EUR/USD currency pair, on the H4 time-frame, was in an upward move until 21st of November when a higher top was recorded at 1.10970. Supply overcame demand and the upward momentum was halted.
A closer look revealed that the Momentum Oscillator displayed negative divergence between point a and b compared to the price at 1.10900 and 1.10970. This could have alerted technical traders to a possible technical reversal.
After the high at 1.10970, the price broke through the 15 and 34 Simple Moving Averages and the Momentum Oscillator broke through the zero baseline into bearish terrain. This confirmed a possible technical price reversal or early stages of a possible new trend.
A likely critical support level formed when a lower bottom was recorded at 1.10524 on the same day. Buyers are currently trying to push the market higher.
If the EUR/USD breaks through the critical support level at 1.10524, then three possible price targets may be projected from there. Attaching the Fibonacci tool to the lower bottom at 1.10524 and dragging it to the possible resistance level at 1.10847, the following targets may be calculated. The first target can be anticipated at 1.10324 (161 %). The second price target can be predicted at 1.10001 (261.8%) and the third and final target may be expected at 1.09479 (423.6%).
If the resistance level at 1.10524 is broken, the scenario is invalidated and will need to be re-evaluated.
As long as sellers maintain a negative sentiment and supply overcomes demand, the outlook for the EUR/USD currency pair on the H4 time-frame will remain bearish.
Disclaimer:
This written/visual material is comprised of personal opinions and ideas. The content should not be construed as containing any type of investment advice and/or a solicitation for any transactions. It does not imply an obligation to purchase investment services, nor does it guarantee or predict future performance. FXTM, its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness of any information or data made available and assume no liability for any loss arising from any investment based on the same.
A closer look revealed that the Momentum Oscillator displayed negative divergence between point a and b compared to the price at 1.10900 and 1.10970. This could have alerted technical traders to a possible technical reversal.
After the high at 1.10970, the price broke through the 15 and 34 Simple Moving Averages and the Momentum Oscillator broke through the zero baseline into bearish terrain. This confirmed a possible technical price reversal or early stages of a possible new trend.
A likely critical support level formed when a lower bottom was recorded at 1.10524 on the same day. Buyers are currently trying to push the market higher.
If the EUR/USD breaks through the critical support level at 1.10524, then three possible price targets may be projected from there. Attaching the Fibonacci tool to the lower bottom at 1.10524 and dragging it to the possible resistance level at 1.10847, the following targets may be calculated. The first target can be anticipated at 1.10324 (161 %). The second price target can be predicted at 1.10001 (261.8%) and the third and final target may be expected at 1.09479 (423.6%).
If the resistance level at 1.10524 is broken, the scenario is invalidated and will need to be re-evaluated.
As long as sellers maintain a negative sentiment and supply overcomes demand, the outlook for the EUR/USD currency pair on the H4 time-frame will remain bearish.
Disclaimer:
This written/visual material is comprised of personal opinions and ideas. The content should not be construed as containing any type of investment advice and/or a solicitation for any transactions. It does not imply an obligation to purchase investment services, nor does it guarantee or predict future performance. FXTM, its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness of any information or data made available and assume no liability for any loss arising from any investment based on the same.