Hi Traders! EURUSD short term forecast and technical analysis is here. The way I would like to analyze the chart for setups is based on multi-timeframe confirmations because in my POV if we get more evidences on different timeframes for the same direction then it makes the setup much more reliable. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club Spoiler alert – free memberships are available!. Now, let’s start our analysis from the highest timeframe which will be the daily chart here.
EURUSD D1(Daily) Chart Analysis – Strong Resistance Zone, Bearish Hidden Divergence, Stochastic Oscillator
On the daily chart, we had a strong support zone and the price which was moving lower has broken below this and held below it. After the breakout this strong support zone is acting as a strong resistance zone for us. Currently the price which is moving higher has reached this strong resistance zone and is holding in this zone, until this zone holds I expect short term bearish moves to happen here. In addition to this, the price has created a bearish hidden divergence between the first high that has formed at 1.06147 and the second high that has formed at 1.02937, based on the MACD indicator, which we may consider as evidence of bearish pressure. Also, based on the Stochastic Oscillator we could see that the price has reached its extreme which we may consider as yet another evidence of bearish pressure. We may now move down to lower timeframe and see if we can find evidences supporting this short term bearish view.
EURUSD H4(4 Hours) Chart Analysis – Bearish Trend Pattern, Bearish Divergence, Two Key Resistance Zones
On the H4 chart, we could see that the price which is moving lower has created a bearish trend pattern in the form of three lower highs, lower lows we may consider this as evidence of bearish pressure. Generally, after a bearish trend pattern, we may expect corrections and then further continuation lower. Currently, it looks like the correction that we were looking for is happening in the form of potential double wave to the upside. In addition to this, we had a bearish divergence that has formed between the first high that has formed at 1.02691 and the second high that has formed at 1.02937 based on the MACD indicator, we may consider this as other evidence of bearish pressure. Also, while measuring this bearish trend pattern using the Fibonacci retracement tool we have two key resistance zones that has formed. The first key resistance zone is formed by the 38.2%(1.02052), 50%(1.02833) Fibonacci retracement zones of the bearish trend pattern and the 61.8%(1.02978) Fibonacci expansion level of the first wave of the correction. The second key resistance zone is formed by the 61.8%(1.03615) Fibonacci retracement zone of the bearish trend pattern and the 100%(1.04223)Fibonacci expansion level of the first wave of the correction. Until these two key resistance zones hold my short term view remains bearish here and if we get a valid breakout below the most recent uptrend line we may then consider it as a validation for this bearish view.
Technical Analysis & Forecast Summary
EURUSD D1(Daily) Chart Analysis
- Strong Resistance Zone, Bearish Hidden Divergence, Stochastic Oscillator
EURUSD H4(4 hours) Chart Analysis
- Bearish Trend Pattern, Bearish Divergence, Two Key Resistance Zones
Trading Tips
It is always recommended to look for confirmations before you jump into any trade. If you are not sure about how to trade this short term sell setup then you can use any setup and strategy that you have in your arsenal to look for bearish moves and join this sell trade.
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Happy Trading!
Arvinth Akash
Traders Academy Club Team.
