On January 10th, the market initiated the depicted bearish channel around 1.1570.
The bearish channel's upper limit managed to push price towards 1.1290 then 1.1235 before the EUR/USD pair could come again to meet the channel's upper limit around 1.1420.
Shortly after, the recent bearish movement was demonstrated towards 1.1175 (channel's lower limit) where significant bullish recovery was demonstrated on March 7th.
Bullish persistence above 1.1270 enhanced further bullish advancement towards 1.1290-1.1315 (the Highlighted-Zone) which failed to provide adequate bearish pressure.
On March 18, a bullish breakout attempt was executed above 1.1327 (the upper limit of the Highlighted-zone). This enhanced further bullish movement towards 1.1450 demonstrating a false bullish breakout above the upper limit of the depicted movement channel.
On the other hand, On March 22, significant bearish pressure was demonstrated around 1.1380 leading to the current bearish decline towards 1.1220 then 1.1220.
Theoretically, the short term outlook for EURUSD pair remains bearish towards 1.1170 and 1.1120 as long as Bearish persistence below 1.1235 (Fibonacci 78.6%) is maintained on H4 chart.
On the other hand, a bullish breakout above 1.1235 (78.6% Fibonacci level) would confirm the depicted bullish Head & Shoulders pattern allowing another bullish pullback to occur towards 1.1280-1.1320 where a better SELL entry can be offered.
Trade recommendations :
Conservative traders should wait for a bullish breakout above 1.1235 for a valid BUY entry.
TP levels to be located around 1.1280, 1.1320. SL to be located below 1.1200.The material has been provided by InstaForex Company - www.instaforex.com