As the evident wedge pattern becomes tighter, tilting towards the south-east of the chart, the bears lurks around, awaiting another chance. The initial desire for a sell-off was initiated over a year ago (08/01/19), when the ascending trendline which has held twice since 2012 was broken. However, even after the market retraced, the sentiment remains downtrend as seen on the MACD.
With a retest formation around Resistance1 and a reversal candle in the previous month, it’s clear the bear wants to have another shot…and we’ll go with them!
Sell | Po: 123.850 | SL: 135.050 | TP1: 115.380 | TP2: 100.460
Regardless of the strategy, one of the daunting task in trading entails getting the entry point right. Carolyn Boroden in her Book, discussed extensively about creating an edge through the Potential Reversal Zone. Simply put, a range in the market where many Fibonacci confluence comes to play.
We have identified a Support Level PRZs on this pair, with set up consisting of Fibonacci levels plotted from different Highs and Lows.
As the market slips into this zone, we await reaction which pushes the trend back in the initial direction. An extended push should not be deeper than the trendline.
The pair is presenting to us two bearish formations here, A Deep Crab Harmonic Pattern completion, and A descending triangle pattern formation.
With MACD also well below Zero, the pair is well heading short.
Getting involve in this trade can be done in several ways. However, I favor the short position and the triangle breakout.
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