The upward momentum, which accelerated by breaking above 1.42, was blocked at the resistance area of 1.425. The pair consolidated at 1.423-1.424 and finally bounced toward 1.415.
Once again, the 70 level of the daily RSI, which indicates entering overbought levels, was not breakable.
In the last 3 times such occurred, the pair lost 200-300 pips (we marked these occasions on the Daily chart). Thus - a reasonable short term target may be 1.395-1.40.
The pair continues to move between the bands of the upward channel.
Its short term bias is Bearish.
The downward momentum should face its first main difficulty at 1.404 level.
The significant resistance area remains between 1.425 and 1.428.
Trading Idea:
Best levels to enter SHORT positions are anywhere between 1.415 and 1.42. At 1.404 area some profits should be taken.
Stop loss is at 1.4215. Second target is at the lower band of the channel at 1.398.
LONG positions should be taken only be breaking above 1.425, with a stop loss at 1.419 or at 1.404-1.405 area, with a stop loss at 1.3985.
Analysis by SignalTrader.com – the leading solution of all the Forex Systems. Automated Trading on Forex, Indices and Commodities.
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