The EUR/USD pair is demonstrating a strong bullish movement which was maintained within the depicted bullish channel. However, during the last week, the market witnessed some bearish retracement in reaction to the upper limit of its movement channel around the price level of 1.2580.
Last week the EUR/USD pair managed to breakdown the short term uptrend line depicted on the chart after finding resistance around the price level of 1.2570. However, the pair came back to retest the backside of the broken trendline as depicted on the chart.
The most significant Resistance level is located around 1.2580. This price level was tested last week expressing a bearish engulfing 4H candlestick which pushed the EUR/USD pair to the downside.That's why a low risk SELL entry is suggested which is taking place right now with a tight SL located above 1.2630.
Fixation above 1.2580 invalidates the bearish scenario for now and opens the way towards the upper limit of the bullish channel depicted in Blue corresponding to price level of 1.2690.
The lower limit of the movement channel as well as SMA 100 are located between 1.2430-1.2400 where price action should be watched for a valid low risk BUY entry with SL located below 1.2370.
The material has been provided by Instaforex Company - instaforex.com
