EUR/USD - Bearish Harmonic Pattern Detected
The EUR/USD pair is currently forming a Bearish Harmonic Pattern (XABCD) on the 4-hour chart. This technical formation suggests a potential reversal zone (PRZ) at Point D, which is crucial for identifying a shift in market sentiment. Point D is further supported by a key support area and a 4-hour trend line, adding to the confluence for a bearish trend reversal.
Entry and Stop Loss:
For this trade setup, we recommend entering a short position at 1.08680. The stop loss is strategically placed at 1.08795 to mitigate risk and protect against unexpected market fluctuations.
Take Profit Levels:
We have identified three take-profit levels based on key support levels and historical price actions. These targets are designed to optimize returns while managing risk effectively:
TP-1: 1.08570
TP-2: 1.08455
TP-3: 1.08345
Technical Indicators and Confluence:
Bearish Harmonic Pattern (XABCD): The formation of this pattern is a strong indicator of a potential bearish reversal.
Potential Reversal Zone (PRZ): Point D aligns with a key support area, enhancing the likelihood of a reversal.
4-Hour Trend Line: The trend line provides additional support, reinforcing the bearish bias.
Conclusion
The confluence of the Bearish Harmonic Pattern, key support area, and 4-hour trend line strengthens our expectation of a bearish trend reversal at Point D. Traders should consider entering at 1.08680, with a stop loss at 1.08795, and aim for the identified take profit levels to maximize potential gains.
Entry and Stop Loss:
For this trade setup, we recommend entering a short position at 1.08680. The stop loss is strategically placed at 1.08795 to mitigate risk and protect against unexpected market fluctuations.
Take Profit Levels:
We have identified three take-profit levels based on key support levels and historical price actions. These targets are designed to optimize returns while managing risk effectively:
TP-1: 1.08570
TP-2: 1.08455
TP-3: 1.08345
Technical Indicators and Confluence:
Bearish Harmonic Pattern (XABCD): The formation of this pattern is a strong indicator of a potential bearish reversal.
Potential Reversal Zone (PRZ): Point D aligns with a key support area, enhancing the likelihood of a reversal.
4-Hour Trend Line: The trend line provides additional support, reinforcing the bearish bias.
Conclusion
The confluence of the Bearish Harmonic Pattern, key support area, and 4-hour trend line strengthens our expectation of a bearish trend reversal at Point D. Traders should consider entering at 1.08680, with a stop loss at 1.08795, and aim for the identified take profit levels to maximize potential gains.