Given the current situation, EURUSD has been on a downtrend. In the chart above, I have two lines at the top, both acting as solid resistance. You might ask "Dude! Why two lines?" Between these two lines is what is called an Area Of Value (AOV). If the price is to break through the first line and enter this AOV, we can comfortably take a short position and hold it until it touches the all-important 1.18000 support.
Furthermore, I have highlighted the point of entry that I believe will be crucial. There have been false breakouts earlier, and it is likely to happen again. Should the price touch the first line, you can either hold back a little to see if it continues upwards and touches the second line, in which case you can execute a sell order. If it is a false breakout, you can place a sell order just a little under the entry position, and that should further confirm your position once a bearish candlestick shows up.
Furthermore, I have highlighted the point of entry that I believe will be crucial. There have been false breakouts earlier, and it is likely to happen again. Should the price touch the first line, you can either hold back a little to see if it continues upwards and touches the second line, in which case you can execute a sell order. If it is a false breakout, you can place a sell order just a little under the entry position, and that should further confirm your position once a bearish candlestick shows up.
Trade closed: target reached:
As described above, The EURUSD did touch the line and had a massive fallout. Those who followed, well, you made quite a bit of profit. I am happy I was able to assist you folks :)